About three months ago, we came out with the notion that Barrick Gold (NYSE:GOLD) was “a buying opportunity for all seasons.” That includes both “election season” and “this season,” because the company has made some big moves since we last saw it, and continues to distinguish itself as a buying opportunity.
The News is as Golden as its Name and Primary Business
The news out of Barrick Gold was once again excellent; the company handily beat earnings estimates out of Zacks, coming in at an adjusted earnings per share (EPS) figure of $0.41 per share where Zacks was looking for $0.32. Given that, this time last year, Barrick Gold was coming out with EPS figures of $0.15, that's still some serious gains no matter how you slice it. It was even better on a non-adjusted basis, as that way, the company pulled in $0.52 per share.
It's also the second time the company has surprised on earnings, and by an even wider margin than before. Last quarter, Barrick Gold was expected to bring in $0.19 per share, and it actually brought in $0.23. So not only is the company gaining in terms of its EPS figures, it's also beating estimates, regularly, and by steadily-growing margins.
Net income also did nicely for the company, posting third quarter income of $882 million. This was with revenues of $3.54 billion, which again beat estimates for the quarter by 5.57%. The $3.54 billion brought in also compares nicely against last year's third-quarter revenue figure of $2.68 billion. Further, this is the third time in the last four quarters that the company beat expectations on revenue, which shows this company is a big one for beating estimates.
More Than Just Great Numbers
The numbers were fantastic for Barrick Gold this quarter, but quarterly numbers alone do not necessarily a value buy make. Thankfully for those interested in buying in, Barrick Gold has more to recommend it than its terrific quarterly numbers.
Barrick Gold recently announced that it was hiking its third-quarter dividend, coming in at $0.09 per share payable on December 15 for anyone who still holds shares as of November 30. That represents at 12.5% increase from last quarter's dividend, and a company that raises dividends consistently tends to be taken seriously by investors.
This is actually the third such increase in the last year, according to the company's chief financial officer Graham Shuttleworth. The increases have been sufficient, Shuttleworth also noted, to make the quarterly dividend three times what it was back in September 2018, when Barrick Gold merged with Randgold.
Moreover, our latest research about the state of the analyst community on Barrick Gold suggests that there's still a lot to like, and the picture has only improved over the last three months. Three months ago, the company had three “hold” ratings and two “buy” ratings. Now, the consensus has shifted to “buy” quite clearly as two of the “hold” ratings left the field altogether, giving Barrick Gold one “hold” and two “buy” ratings. The price target has also increased nicely since we last discussed Barrick Gold, going from an average of $24.07 to $31.24 per share.
Still Has the Golden Touch
We know from the last time we looked at Barrick Gold that the company has a lot going for it. It can effectively work both sides of an economy at the same time; when things are good, the company is a copper miner to match the best of them, and copper is in high demand in economic boom times because it has a massive industrial demand. Meanwhile, when things aren't so hot, the word “gold” is right in the company's name, and it can deliver on one of the greatest poor-economy hedges known to man: gold prices. No matter who ultimately wins the presidential election, no matter what happens to the economy in the next few months, Barrick Gold is ready to take advantage of the conditions yielded with both safe-haven assets and industrial boom assets.
At its base, the company has a lot going for it, and that's apparent in its share price, its steadily-increasing dividend, and the revenue and profit figures the company's bringing in. It's hard not to recommend buying in on a company that boasts this kind of solid, reliable growth, even for the most risk-averse investor out there. If you haven't already bought in on Barrick Gold, and bought a stable, producing company that's set to deliver no matter the economy, then your opportunity to do so is still in play.
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