It's been a great afternoon session for Barrick Gold investors, who saw their shares rise 1.4% to a price of $19.59 per share. At these higher prices, is the company still fairly valued? If you are thinking about investing, make sure to check the company's fundamentals before making a decision.
Barrick Gold Has Attractive P/B and P/E Ratios:
Barrick Gold Corporation engages in the exploration, mine development, production, and sale of gold and copper properties in Canada and internationally. The company belongs to the Basic Materials sector, which has an average price to earnings (P/E) ratio of 23.66 and an average price to book (P/B) ratio of 2.69. In contrast, Barrick Gold has a trailing 12 month P/E ratio of 22.8 and a P/B ratio of 1.45.
Barrick Gold's PEG ratio is 2.27, which shows that the stock is probably overvalued in terms of its estimated growth. For reference, a PEG ratio near or below 1 is a potential signal that a company is undervalued.
Generally Positive Cash Flows and a Positive EPS Growth Rate:
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $7,243 | $9,717 | $12,595 | $11,985 | $11,013 | $11,397 |
| Net Margins | -21% | 41% | 18% | 17% | 4% | 11% |
| Net Income (M) | -$1,545 | $3,969 | $2,324 | $2,022 | $432 | $1,272 |
| Net Interest Expense (M) | $452 | $435 | $342 | $357 | $366 | $387 |
| Earnings Per Share | -$1.32 | $2.26 | $1.31 | $1.14 | $0.24 | $0.72 |
| EPS Growth | n/a | 271.21% | -42.04% | -12.98% | -78.95% | 200.0% |
| Free Cash Flow (M) | $1,765 | $2,833 | $5,417 | $4,378 | $3,481 | $3,732 |
| Total Debt (M) | $5,695 | $5,161 | $5,135 | $5,135 | $4,769 | $4,715 |
| Current Ratio | 2.38 | 2.9 | 3.67 | 3.95 | 2.71 | 3.16 |
Barrick Gold has generally positive cash flows, an excellent current ratio of 3.16, and positive EPS growth.
