On Mar 19, we issued an updated research report on
). The gold miner is exposed to soft metals pricing environment
and uncertainties surrounding its Pascua-Lama mine.
BARRICK GOLD CP (ABX): Free Stock Analysis
ANGLOGOLD LTD (AU): Free Stock Analysis
GOLDEN STAR RES (GSS): Free Stock Analysis
NOVAGOLD RSRCS (NG): Free Stock Analysis
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Lower metals pricing hurt Barrick's top and bottom lines in the
fourth quarter of 2013, reported on Feb 13. Adjusted earnings
missed the Zacks Consensus Estimate. Revenues fell by double
digits year over year, but beat expectations. The company expects
gold production to decline year over year in 2014.
A volatile gold pricing environment and challenging economic
conditions are concerns for Barrick. Moreover, uncertainties
surrounding the Pascua-Lama project continue to weigh on the
company's share price.
Barrick, during the fourth quarter, temporarily halted
construction activities at the Pascua-Lama mine (which overlaps
the border of Chile and Argentina), barring the requisite
activities for environmental protection and regulatory
Barrick, a Zacks Rank #4 (Sell) stock, noted that it will halt
work in a manner that will allow efficient and effective re-start
when conditions permit. The decision to re-start the project will
depend on certain factors including metal prices outlook and
reduced uncertainty related to legal and other regulatory
requirements. The company expects to spend roughly $300 million
on account of ramp-down and other expenses related to the mine in
Decreasing gold reserve represents another concern. Barrick's
gold reserves fell around 26% year over year in 2013 due to
depletion, divestments and lower metals price assumption. The
company also has a debt-laden balance sheet with total debt of
roughly $13 billion at the end of 2013.
Other Stocks to Consider
Other companies in the gold mining space with favorable Zacks
AngloGold Ashanti Ltd.
Golden Star Resources, Ltd.
NovaGold Resources Inc.
). While AngloGold Ashanti holds a Zacks Rank #1 (Strong Buy),
both Golden Star Resources and NovaGold Resources carry a Zacks
Rank #2 (Buy).