Does B2Gold’s 95% Stock Surge Reflect Its True Value After the Sabina Acquisition?

Thinking about what to do with your B2Gold shares, or eyeing them for the first time? You’re not alone. The gold miner has caught eyes for all the right reasons this year. If you’re wondering whether its run can continue, you’re asking the right questions. After a red-hot start, B2Gold’s stock price has surged an astonishing 95.4% year-to-date. Even with a dip of -3.6% over the past week, the overall momentum remains strong, backed by a 16.7% climb over the last month and a 56.5% return for investors over the past year.

What has been fueling this impressive trajectory? Part of it reflects shifting sentiment around gold’s role as a safe haven asset, as global uncertainty continues to make the precious metal look attractive. In addition, B2Gold remains in the spotlight after successfully completing its recent acquisition of Sabina Gold & Silver, which was widely viewed as a positive bolt-on deal that is expected to contribute to production growth and resource expansion in the future. The acquisition also helps strengthen B2Gold’s pipeline, a point that investors and analysts have been watching closely for signs of long-term sustainability and lower risk.

With its value score coming in at 5 out of 6 on our undervaluation checks, B2Gold looks compelling in more ways than one. Here, we break down the valuation methods behind that number and, more importantly, explore what might be an even better way to spot value before the rest of the market does.

Why B2Gold is lagging behind its peers

Approach 1: B2Gold Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model estimates a company’s intrinsic value by projecting its future cash flows and discounting them back to today’s value. For B2Gold, this approach considers both near-term analyst expectations and longer-term forecasts to form a comprehensive view.

Currently, B2Gold’s Free Cash Flow (FCF) is negative at $-297 million. However, analysts expect this to turn strongly positive, with FCF projected to reach $1.86 billion by 2029 and continue growing beyond, according to Simply Wall St's extrapolated estimates. This forecast uses a two-stage Free Cash Flow to Equity model, which captures both analyst views for the coming years and modeled scenarios for later years.

When the present value of these future cash flows is summed, the resulting intrinsic value per share stands at $60.61. That implies the stock is trading at an 88.0% discount compared to its intrinsic value, suggesting that the market may be overlooking significant value in B2Gold’s growth prospects and future earnings power.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for B2Gold.

Our Discounted Cash Flow (DCF) analysis suggests B2Gold is undervalued by 88.0%. Track this in your watchlist or portfolio, or discover more undervalued stocks.

Approach 2: B2Gold Price vs Sales

The Price-to-Sales (P/S) ratio is often the best yardstick for valuing resource companies like B2Gold, especially when profits may fluctuate or be negative due to large capital expenditures. The P/S multiple provides clarity by focusing on how the market values each dollar of company sales, making it a practical choice for cyclical or high-growth sectors.

In theory, a higher P/S ratio should reflect either robust sales growth prospects, industry leadership, or lower risk. Conversely, a lower ratio signals more limited growth or higher risk. Comparing P/S across similar companies or relative to industry averages gives context to whether a stock is being valued optimistically, pessimistically, or somewhere in between.

B2Gold currently trades at a P/S ratio of 3.15x, which is well below both the Metals and Mining industry average of 6.19x and the peer average of 13.26x. To provide more nuance, Simply Wall St’s "Fair Ratio" model estimates B2Gold’s appropriate P/S at 7.10x, considering its unique blend of growth, margins, size, and sector-specific risks. This methodology goes further than just comparing with peers or industry averages by tailoring the assessment to the company’s fundamentals and operating context.

With the market valuing B2Gold at a much lower multiple than its Fair Ratio suggests, there is a clear disconnect. This indicates the stock may be undervalued based on the preferred sales multiple.

Result: UNDERVALUED

PS ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your B2Gold Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let's introduce you to Narratives. A Narrative is your personal story and outlook for a company, linking what you believe about its business, such as production growth or operational risks, to your assumptions for future revenue, earnings, and margins. This process helps form your own fair value estimate.

Rather than relying solely on static numbers, Narratives connect the company’s story to financial forecasts and then translate those into an estimated fair value for the stock. On Simply Wall St’s Community page, Narratives make this process simple and accessible for investors of any experience level, allowing you to create or explore these living stories alongside millions of others.

By comparing your Narrative-derived Fair Value to B2Gold’s current market price, you gain a clear framework to help answer big questions like when to buy or sell. Narratives update automatically when meaningful news, forecasts, or earnings numbers come in, ensuring your view always reflects the latest information.

For example, B2Gold Narratives in the Community currently range from highly optimistic, emphasizing Goose Mine’s ramp-up, new projects, and a CA$7.99 fair value, down to the cautious, where concerns about regulatory risks and margins support a lower CA$5.36 estimate. Narratives empower you to take control of your investment story with both numbers and context.

Do you think there's more to the story for B2Gold? Create your own Narrative to let the Community know!

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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