Should You Buy Barrick Gold Stock Ahead of Q1 Earnings?

Core Viewpoint - Barrick Gold Corporation (GOLD) is expected to report first-quarter 2025 results on May 7, with anticipated higher earnings due to rising gold prices, despite facing cost challenges [1][5]. Earnings Expectations - The Zacks Consensus Estimate for first-quarter earnings has been revised upward by 26.1% in the past 60 days, with an expected earnings of 29 cents per share, indicating a 52.6% year-over-year increase [1]. - GOLD has beaten the Zacks Consensus Estimate for earnings in three of the last four quarters, averaging an earnings surprise of approximately 12% [3]. Production and Costs - Production for the upcoming quarter is estimated at 710,000 ounces, reflecting a sequential decline of around 34% and a 24% decrease from the previous year [6]. - Higher production costs are anticipated to impact first-quarter results, with cash costs per ounce of gold increasing by about 7% year-over-year in Q4 2024, and AISC rising roughly 6% [8]. Market Conditions - Gold prices have surged nearly 19% in the first quarter and are up approximately 23% year-to-date, driven by safe-haven demand amid global trade tensions and economic uncertainties [5]. - The company's stock has gained 11.6% over the past year, underperforming the Zacks Mining – Gold industry's 47.2% increase [9]. Valuation - GOLD is currently trading at a forward 12-month earnings multiple of 10.76, which is about 28.1% lower than the industry average of 14.96X [12]. Growth Prospects - The company is well-positioned to benefit from key growth projects that are on schedule and within budget, which should significantly contribute to future production [14]. - GOLD maintains a strong liquidity position and generates healthy cash flows, allowing it to capitalize on development and acquisition opportunities [15]. Challenges - The company faces challenges from higher production costs, including increased mine-site sustaining capital spending and labor costs, which may impact profit margins [16]. Investment Outlook - Despite the positives, the high production costs warrant caution, and holding onto GOLD shares is advisable for current investors awaiting further clarity post-earnings release [17].