VALUATION HIGHLIGHTS

1. North American Gold Mines (Barrick Nevada, Pueblo Viejo Mine, Dominican Republic) constitute 59% of the Trefis price estimate for Barrick Gold's stock.
2. Other Gold Mines constitute 27% of the Trefis price estimate for Barrick Gold's stock.

WHAT HAS CHANGED?

1. Q4 2023 Earnings

Barrick Gold posted a better-than-expected set of Q4 2023 earnings. Revenue rose by 10.5% year-over-year to $3.06 billion, while earnings came in at $0.27 per share. However, the company reported softer gold production guidance for FY 2024 of 3.9 million ounces to 4.3 million ounces, compared with 4.05 million ounces in 2023.

2. Recent surge in gold prices

Gold prices have been on the upswing through 2023, rising from around $1,830 per ounce at the beginning of January 2023 to close to $2,030 per ounce as of December 2023. The gains come amid easing inflation and signs that the Federal Reserve is scaling back on the pace of interest rate hikes as the economy also cools.

POTENTIAL UPSIDE & DOWNSIDE TO TREFIS PRICE

Below are key drivers of Barrick Gold's value that present opportunities for upside or downside to the Trefis price estimate for the company's stock:

Gold shipments from Barrick Nevada

• Barrick Nevada Shipments: Shipments from Barrick's Nevada operations have declined from almost 4 million ounces in 2019 to 3.5 million ounces in 2021. We expect the metric to stabilize at about 3.4 million ounces by 2029. However, if the metric actually rises to about 4 million ounces, there could be a 10% increase in our price estimate. On the other side, if shipments fall to about 3 million ounces, there could be a 10% downside to our price estimate.

BUSINESS SUMMARY

Barrick Gold Corporation (NYSE:GOLD) is the world's largest gold mining company and is headquartered in Toronto. The company operates primarily in four regions - North America, South America, Australia Pacific, and Africa. All four regions produce gold and produce copper in South America and Africa.

The company's total gold and copper reserves stood at 69 million ounces and 12 billion pounds, respectively, at the end of 2021.

SOURCES OF VALUE

Gold as the primary source of revenue

Gold mining is the most important division for Barrick Gold in terms of revenues and profits. In 2021, the company generated around $10.5 billion in revenues from the sale of gold and $1 billion from copper sales in 2021.

KEY TRENDS

Rising demand for gold from emerging economies

Demand for gold is expected to be quite robust from major emerging economies. Rapidly growing middle-class populations and rising incomes in these countries, particularly China and India - the world's largest gold consumers - are expected to result in a sustained jewelry and investment demand for gold.

Barrick is bolstering copper production

Barrick is moving to scale up its copper production in a big way given that the metal is expected to see higher demand as the global economy moves to green energy solutions and electric vehicles. Barrick could also have an edge over other miners in the copper space, considering that copper often occurs alongside gold in large-scale deposits.