RBC Capital has upgraded shares of Barrick Gold Corp. (ABX, Financial) to an outperform rating from sector-perform, sending the company's stock up 2.62% to $12.13 a share.
More upsides will likely follow as the market offers up an appealing entry point in one of the best gold mining stocks.
After having lost 33% and underperformed the Van Eck Vectors Gold Miners (ETF) by nearly 25% for the 52-weeks through March 12, the world's largest gold producer is trading at incredibly cheap prices. The share price is plainly below the 200, 100 and 50-SMA lines, according to GuruFocus.
The current market valuation is a 40% discount of the 52-week high price of $20.36 per share. The 52-week low is $11.07 per share.
The price-book ratio is 1.54 times versus an industry median of 2.06 times and the EV-to-Ebitda ratio is 3.98 times versus an industry average of 9.90 times.
With a target price of $16 per share, RBC Capital foresees a nearly 32% stock appreciation. RBC Capital’s new estimate has also dragged the average target price of Barrick Gold Corp up to $16.35 per share. This is a mean of 21 estimates ranging from $11 to $20.30.
It was since last summer when Berenberg released a hold rating, which didn't prompt an upgrade. Meanwhile, Barrick Gold Corp. received four downgrades from Citigroup (buy to sell) on Nov. 30, 2017, from RBC Capital (outperform to sector perform) on Nov. 1, 2017 from Credit Suisse (outperform to neutral) on Oct. 26, 2017 and from BMO Capital (market perform) on July 6, 2017.
The recommendation rating is 2.8 of a 1.0 (strong buy) to 5.0 (sell) range.
As of March 2018, eight of 24 analysts are on a buy to strong-buy approach while 15 recommend holding Barrick Gold Corp. One analyst suggests a sale of the stock.
According to GuruFocus, the tycoons who acquired shares of Barrick Gold Corp. in the last quarter include Joel Greenblatt (Trades, Portfolio) who increased his holding by 23.47% to 469,515 shares, John Rogers (Trades, Portfolio) with a 15.54% increase in ownership to 690,291 shares and Pioneer Investments (Trades, Portfolio) who initiated a position in Barrick Gold Corp. Pioneer Investments (Trades, Portfolio) acquired 1,840,878 shares.
(Disclosure: I have no positions in any security mentioned in this article.)
