A month has gone by since the last earnings report for Barrick Gold (GOLD). Shares have lost about 7.1% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Barrick Gold due for a breakout? Before we dive into how investors and analysts have reacted as of late, let’s take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Barrick’s Earnings and Sales Surpass Estimates in Q1
Barrick recorded net earnings (on a reported basis) of $438 million or 25 cents per share in first-quarter 2022, down from $538 million or 30 cents per share in the year-ago quarter.
Barring one-time items, adjusted earnings per share were 26 cents. The figure beat the Zacks Consensus Estimate of 23 cents.
Barrick recorded total sales of $2,853 million, down 3.5% year over year. The figure surpassed the Zacks Consensus Estimate of $2,841 million. Results in the reported quarter benefited from higher gold prices. The company witnessed a strong performance from Loulo-Gounkoto in the quarter, driven by solid throughput, recovery and grade.
Operational Highlights
Total gold production amounted to around 990,000 ounces in the first quarter, down 10% year over year. The average realized price of gold was $1,876 per ounce in the quarter, up 6% year over year.
Cost of sales increased 11% year over year to $1,190 per ounce. AISC moved up around 14% year over year to $1,164 per ounce in the quarter.
Copper production increased 9% year over year to 101 million pounds. The average realized copper price was $4.68 per pound, up 14% year over year.
Financial Position
At the end of the quarter, Barrick had cash and cash equivalents of $5,887 million, up 4% year over year. The company’s total debt was $5,144 million at the end of the quarter, flat year over year.
Net cash provided by operating activities declined 23% year over year to $1,004 million for the quarter.
The company’s board declared a dividend of 20 cents per share for the first quarter of 2022, suggesting an increase of 100% on the previous base quarterly dividend of 10 cents.
Guidance
For 2022, the outlook for Barrick remains unchanged. It anticipates attributable gold production in the range of 4.2-4.6 million ounces. AISC is expected in the range of $1,040-$1,120 per ounce and cash costs per ounce are projected in the band of $730-$790 per ounce.
The company also expects copper production in the range of 420-470 million pounds at AISC of $2.70-$3.00 per pound and cost of sales of $2.20-$2.50 per pound.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision flatlined during the past month.
VGM Scores
Currently, Barrick Gold has an average Growth Score of C, however its Momentum Score is doing a lot better with an A. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren’t focused on one strategy, this score is the one you should be interested in.
Outlook
Barrick Gold has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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