Barrick Gold Corp News and Stock Forecast

Gold prices have been rapidly rising, surging over $300 compared to the average price in the last few months of 2023. This increase, particularly strong in the current quarter (April-June 2024), is good news for gold mining companies like Barrick Gold.

If gold prices stay high through June, it's expected to translate into significantly higher earnings for miners. This would be a welcome change after a rough start to the year for these companies.

Underperformance of Mining Stocks

Even though the price of gold is way up, gold mining companies like Barrick haven't been big winners so far in 2024.

Gold miners haven't seen the big gains you might expect. The industry as a whole, tracked by the VanEck Gold Miners ETF, is only up about 9%, which isn't that impressive.

Barrick might have set some low expectations. Investors were disappointed with Barrick's plans for how much gold they'll mine and how much it will cost them. This could be one reason their stock price hasn't gone up as much as some might have hoped.

Preference for Gold Over Stocks

Investors, particularly those outside the U.S., have shown a preference for gold over mining stocks this year. Despite the rise in gold prices, stocks like Barrick are trading below their levels from 2004, indicating a lack of investor confidence in these companies.

Potential Upside for Barrick Gold

Good news for gold mining companies like Barrick Gold: gold prices are way up!

This means these companies could make much more money than they were earlier in the year. 

• Mining stocks benefit from something called operating leverage. Basically, this means that if the price of gold goes up a little, the company's profits go up a lot.
• Right now, gold is much more expensive than what Barrick was selling it for in the last few months of 2023. This means there's a big chance for their profit margins (the percentage of money they make on each sale) to grow.
• If gold prices stay high or even keep going up, this could lead to a big jump in profits for gold mining companies. Investors might find this hard to resist, which could be good for the companies' stock prices.

Analysts are predicting a significant increase in earnings per share (EPS) this year, around 20% growth to $1.01. Some analysts even believe this might be a low estimate.

• Barrick expects to produce a lot of gold this year, around 4 million ounces.
• If gold prices stay high and they hit or even surpass their production targets, Barrick could make even more money than analysts predict.

So, things are looking positive for Barrick in 2024! Keep in mind, these are just predictions, but based on current gold prices and production forecasts, the future seems bright.

Barrick Gold Technical Analysis (Daily timeframe)

The price crossed above the 50-day moving average (MA) on March 5th, and shortly after that, it crossed above the 200-day MA. This is a bullish signal, as it suggests an uptrend in price.

• Currently, the price is trading above both MAs. This further reinforces the bullish trend.
• The 50-day MA is below the 200-day MA and appears to be getting closer. This is a continuation of the bullish trend but can also be a sign of weakening momentum if the 50 MA flattens or starts turning downwards.

Fibonacci Levels

• The price crossed above the 23.6% Fibonacci retracement level, tested it for support, and then moved upwards.
• It hasn't reached the 38.2% Fibonacci retracement level yet.

The price seems to be forming a descending triangle pattern. This pattern can be bullish or bearish, depending on how the price breaks out of the triangle. In this case, the triangle's downward trendline suggests a bullish bias, since the price is trading above both moving averages, an upside breakout is what’s happening.

Technical Indicators

• RSI (Relative Strength Index) is in the overbought zone. This means that the stock may be due for a pullback in the short term.
• MACD (Moving Average Convergence Divergence) is above 0. This is a bullish signal.
• RVI (Relative Volatility Index) is also above 0. This indicates that the stock is in a volatile state.

Overall, the technical analysis of Barrick Gold is mixed. The moving averages and MACD suggest a bullish trend, while the RSI indicate a possible pullback.

Conclusion

Sharp rise in gold prices presents an opportunity for Barrick to improve its earnings and potentially reverse the underperformance seen in stock so far this year. If gold prices continue to hold or increase, coupled with efficient operations and production targets being met, company could see significant upside in financial performance.