Barrick Gold's Golden Cross Opportunity — Analyst Sees 'Ample Opportunity For Catch Up' Post Q1

Barrick Gold Corp GOLD recently reported its first-quarter (Q1) earnings, surpassing Street estimates and offering a positive outlook for the future.

Strong Q1 Financial Performance and Outlook

In Q1 2024, Barrick reported adjusted EPS of $0.19, beating the $0.15 estimate. Sales of $2.747 billion came in line with expectations. The company’s capital expenditure for 2024 is projected to be between $2.5 billion and $2.9 billion. Despite missing Q1 production targets, Barrick maintains its 2024 outlook, expecting steady gold production increases.

Related: Barrick Gold Maintains FY24 Outlook Despite Q1 Production Miss

Analyst Sees Ample Opportunity For ‘Catch Up’

BMO Capital Markets’ analyst Jackie Przybylowski’s recent insights on Barrick Gold’s performance and outlook provide a compelling investment thesis for the company.

Barrick’s strong Q1 2024 earnings, which beat Street estimates, reflect the company’s ability to navigate challenges and deliver solid results. “It’s early in the year, and we see sufficient time and
ample opportunity for ‘catch up’,” said Przybylowski.

Additionally, management’s credible plan to improve production and costs through 2024 indicates a strategic focus on efficiency and growth. The analyst’s Outperform rating and one-year target price of $26 per share suggest significant upside potential for investors.

Key Catalysts

Przybylowski sees organic growth as a “strategic differentiator” for Barrack Gold. She sees “Barrick’s existing pipeline offers meaningful growth and catalysts for both copper and gold.”

Barrick Gold’s existing pipeline offers significant growth opportunities in both copper and gold, as highlighted by Przybylowski. The company’s strategic initiatives, including – the Pueblo Viejo expansion project, Porgera restart, and optimization or growth at Nevada Gold Mines, Lumwana super pit, and Reko Diq development – are expected to drive future performance.

Technical Analysis Signals Golden Cross

On the technical front, Barrick Gold’s stock recently formed a Golden Cross, indicating a potential bullish trend.

Chart: Benzinga Pro

As can be seen in the chart above, the 50-day simple moving average (SMA) has crossed over the 200-day SMA, triggering a strong bullish sentiment for the stock.

A Golden Cross is a basic technical indicator that occurs in the market when a short-term moving average (50-day) of an asset rises above a long-term moving average (200-day). When traders see a Golden Cross occur, they view this chart pattern as indicative of a strong bull market.

Barrack Gold’s Golden Cross comes as the stock has shown resilience, despite being down 13.89% over the past year and -9.56% year-to-date. The stock’s performance contrasts with the 13.94% increase in the spot gold price over the past year and 11.74% year-to-date.

Barrick Gold’s positive Q1 earnings report, coupled with its strategic growth initiatives and favorable technical signals, paints a promising picture for the company.

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