Barrick Gold (TSX:ABX): Rethinking Valuation as Gold Hits $3,000 and Market Sentiment Shifts

After a dramatic rally in gold miners, Barrick Mining (TSX:ABX) is drawing attention as market sentiment quickly adjusts. With gold now holding above $3,000 an ounce, investors are rethinking what this could mean for the company’s long-term valuation.

See our latest analysis for Barrick Mining.

Barrick Mining’s share price has more than doubled year-to-date, benefiting from gold’s surge above $3,000 and an industry-wide rerating as investors recalibrate expectations for precious metals. While there have been quick pullbacks in miner stocks, momentum is still apparent. Barrick’s 90-day share price return is an impressive 66%, and its three-year total shareholder return of 151% highlights both the speed and endurance of its latest run.

If Barrick’s explosive momentum has you curious, it might be the perfect moment to broaden your horizons and discover fast growing stocks with high insider ownership

With Barrick’s valuation near record highs and analyst targets rapidly moving upward, investors now face the key question: is Barrick Mining undervalued in this market, or has its next chapter of growth already been priced in?

Most Popular Narrative: 18.7% Undervalued

Barrick Mining’s most widely followed valuation narrative, authored by gmalan, places fair value near CAD 56 compared to the last close of CAD 48.76. This suggests the recent price rally may still trail the company’s intrinsic worth, just as market uncertainty peaks.

Analysts expect moderate earnings growth driven by stable gold output and expanding copper exposure, with long-term upside if gold prices rise further under a scenario of fiscal stress and geopolitical tension known as the “Great Unwinding.”

Read the complete narrative.

Want to know what’s powering this bullish outlook? There’s a bold call for rising profits, and the narrative is betting on a seismic shift in gold demand. Curious about the specific growth drivers some believe could unlock major value? Only the full story reveals the numbers behind the conviction.

Result: Fair Value of $56 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, a swift resolution to U.S. fiscal issues or a sudden downturn in gold prices could quickly reverse Barrick’s perceived undervaluation.

Find out about the key risks to this Barrick Mining narrative.

Another View: Discounted Cash Flow Shows Caution

Looking through the lens of our DCF model, the picture changes. The SWS DCF model estimates Barrick Mining’s fair value at CA$34.14, so the current share price is actually above this level. This suggests the optimism seen in other models might not tell the whole story. Could Barrick be riding market momentum more than fundamentals?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Barrick Mining for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Barrick Mining Narrative

If you have a different perspective or want to test your own assumptions, you can build a personalized narrative in just a few minutes. Do it your way

A great starting point for your Barrick Mining research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

Looking for More Investment Ideas?

Smart investors act, not wait. Use the Simply Wall Street Screener to spot high-potential opportunities others may be missing. Don’t let the next wave of winners pass you by.

• Uncover surprising upside in the market by tracking these 876 undervalued stocks based on cash flows, driven by strong fundamentals and attractive valuations most overlook.
• Generate reliable income streams by targeting these 17 dividend stocks with yields > 3%, with yields above 3% and impressive financial health.
• Position yourself at the forefront of AI innovation. Capitalize on the momentum fueling these 24 AI penny stocks, making headlines with transformative technology.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com