Barrick Gold (TSX:ABX) Valuation in Focus After Major Fourmile Gold Discovery News

Sometimes, a single announcement grabs the market’s attention and leaves investors wondering if it marks something transformative for the business. That is exactly what is happening with Barrick Mining (TSX:ABX) following the company’s latest updates on the Fourmile project in Nevada. Management now describes Fourmile as one of the century’s most significant gold finds, offering a rare mix of scale and high grade that mining analysts appreciate. Studies suggest substantial resource growth, ongoing drilling is showing additional potential, and the early economic analysis points to years of low-cost production. It is no surprise this news is influencing how investors view Barrick’s long-term prospects.

This renewed optimism has contributed to Barrick’s share price performance throughout the year, with evident momentum in recent months. Over the past month, the stock has risen 26 percent, and the gain reaches 57 percent for those tracking it since early summer. Growth-focused investors may also note that Barrick’s annual revenue and net income have both advanced by double digits, suggesting that this development is more than just a brief surge. With the Fourmile project’s ramp-up now expected to complement existing production, there is growing speculation that Barrick may be entering a new growth phase.

The key question now is whether all this potential has already been captured in the share price, or if the current momentum may present an opportunity for those looking to participate in Barrick’s ongoing growth story.

Most Popular Narrative: 18.7% Overvalued

The prevailing narrative sees Barrick Mining as trading well above its fair value. This valuation is mainly driven by long-term growth projections and expectations of higher profit margins. However, the current market price sits meaningfully above consensus targets.

Significant ongoing expansion of both gold and copper production capacity, particularly at Lumwana and via organic growth at Fourmile and Reko Diq, positions Barrick to capture elevated long-term demand for gold (as a financial hedge during geopolitical uncertainty and inflation) and copper (driven by electrification and infrastructure investment). This supports top-line revenue growth over the coming decade.

Want to know what underpins these big growth projections? The narrative relies on bold assumptions about Barrick’s earnings and margins improving sharply from here. Curious which financial forecasts and sector dynamics could justify such a steep premium over fair value? Unlock the surprising details behind this market-beating valuation and see what analysts are really expecting for Barrick’s future.

Result: Fair Value of $38.37 (OVERVALUED)

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

However, ongoing instability in key mining regions and stricter global ESG standards could present unexpected challenges to Barrick’s projected growth and profitability outlook.

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

Another View: Discounted Cash Flow Model

Taking a different approach, our DCF model also points to Barrick's shares trading above their estimated fair value. This raises an important question: is recent optimism getting ahead of tangible long-term returns?

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 would rather dig into the numbers firsthand and shape your own outlook, you can craft a personal thesis in just minutes. Do it your way.

A great starting point for your Barrick Mining research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

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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.

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