Does Barrick Gold’s 37% Rally in 2025 Reflect Its True Value?

If you are sizing up Barrick Mining and wondering if it is time to buy, sell, or hold, you are not alone. With the stock up over 21% in the last 30 days and surging more than 37% in the past three months, Barrick has been catching the eye of both seasoned investors and newcomers alike. While the gold market's momentum and improving earnings have given the share price a lift, there is always the question of whether the stock's run has left it expensive or if there is more growth ahead.

When we break down Barrick's fundamental data, we see strong annual growth in both revenue and net income, alongside a current price just a shade below analyst targets. What is even more interesting is the overall value score: Barrick comes in at a 4 out of 6, reflecting undervaluation in four key areas measured by standard valuation methods. That is a solid score and better than most mining peers right now.

With this performance and valuation in mind, you are likely asking: do these numbers really mean Barrick Mining is a buy? Let’s dig into the specifics of how its current valuation is assessed, and stay tuned for a different perspective on the best way to judge value at the end of the article.

Barrick Mining delivered 30.6% returns over the last year. See how this stacks up to the rest of the Metals and Mining industry.

Approach 1: Barrick Mining Cash Flows

A Discounted Cash Flow (DCF) model estimates what a company is really worth by projecting its future cash flows and then discounting those numbers back to their present value. This method aims to look beyond current market sentiment and focus on the business’s core profit-generating potential.

For Barrick Mining, the latest Free Cash Flow stands at $1.43 billion. Analysts project these cash flows to steadily grow, with estimated Free Cash Flow reaching about $2.14 billion in 2029, along with a series of similar projections for the next decade. When these future estimates are combined and appropriately discounted, the DCF model suggests an intrinsic value of $27.16 per share for Barrick Mining.

When this intrinsic value is compared to the current market price, the stock appears to be about 3.6% undervalued. This indicates that the share price is closely aligned with the business’s actual cash-generating capability, and any premium or discount at present is relatively moderate.

Result: ABOUT RIGHT

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Barrick Mining's DCF analysis). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes.

Approach 2: Barrick Mining Price vs Earnings

The price-to-earnings (PE) ratio is a reliable way to value profitable companies like Barrick Mining because it connects the current share price to the earnings that each share generates. Investors often use the PE ratio to gauge whether a stock is fairly priced by comparing it to similar companies, sector norms, and the company’s own long-term growth outlook.

Growth expectations and perceived risk both play key roles in determining what is considered a “normal” or “fair” PE ratio. Companies with stronger projected earnings growth or more predictable profits typically command higher PE ratios. On the other hand, elevated risk can push that standard lower.

Barrick Mining’s current PE ratio stands at 16.2x. This is noticeably below the Metals and Mining industry average of 23.3x, as well as the 19.3x average among its peers. According to the proprietary Fair Ratio metric, which factors in Barrick’s earnings growth, profit margins, risks, and other market characteristics, a fair PE for the stock would be 24.8x. This suggests that the stock’s price, relative to its earnings, aligns closely with what would be expected given its fundamentals.

Result: ABOUT RIGHT

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Upgrade Your Decision Making: Choose your Barrick Mining Narrative

Narratives are a simple and powerful way to express your unique view of a company. They capture your perspective on Barrick Mining’s future by telling the story behind the numbers, such as your own estimates of fair value, future growth, and profit margins.

Unlike traditional ratios, a Narrative connects your interpretation of Barrick’s strengths and risks to a financial forecast. This process then translates your viewpoint into a fair value, making it clear if you consider the stock to be undervalued or overpriced.

On the Simply Wall St platform, Narratives make investing more accessible by letting you define and track your story while also seeing how millions of other investors are thinking about the same stock.

Narratives empower you to decide when to buy or sell by directly comparing your own Narrative-based Fair Value to the current share price. They automatically refresh whenever new data emerges, such as earnings releases or breaking news.

For example, one investor may see Barrick Mining’s stable portfolio and prudent growth strategy as supporting steady 4.5% annual revenue growth with a fair value of $20.44. Another investor, focusing on faster production expansion and higher margin recovery, might project 20% revenue growth and a fair value of $36.

Do you think there's more to the story for Barrick Mining? 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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