Strong Gold Production Is A Good Sign


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Barrick Gold: Strong Gold Production Is A Good Sign

  • Gold production for the fourth quarter of 2019 was above expectations, with 1,439K Au Oz up 10.2% sequentially. The JV with Newmont Goldcorp in Nevada did particularly well.
  • Revenues for the 4Q’19 are expected to be very solid, with the gold price at $1,481 per ounce.
  • GOLD is one of our long-term gold miners. We recommend a prudent accumulation.

Source: Barrick Gold

Investment Thesis

The Toronto-based new Barrick Gold (GOLD) is one of the largest gold producers worldwide. Barrick Gold is also producing copper from two joint ventures, and Lumwana mine 100% owned.

In December 2019, Barrick sold 90% of its stake in the Massawa project for $430 million and closed the divestiture of its 50% stake in Kalgoorlie mine for $750 million.

Barrick Gold is one of the three gold miners that we consider ou core long-term “gold miners.”

Barrick Gold and Agnico Gold have outperformed the VanEck Gold Miners ETF (GDX) on a one-year basis.

ChartData by YCharts

The size of Barrick Gold makes it a perfect proxy for gold. The general outlook seems exciting, especially with a high price of gold entering 2020.

The general investment thesis that we recommend for Barrick Gold is to keep a long-term position that can be built-up with a slow accumulation using weakness. At the same time, we recommend using a maximum of 35%-40% of your total GOLD holding, for the short-term trading, primarily to take advantage of the volatility of the gold sector. It is wise to get your dividend in share.

Wan’t to know more about GOLD (Barrick Gold) and other Gold Mining companies in our Selection List, check out our Category Gold & Silver and get out Report of January.

(Sources SeekingAlpha, Finance Yahoo)


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