I own this stock of Barrick Gold Corp (TSX-ABX, NYSE-ABX). This is a big gold mining company that I have followed for years. It was on some dividend growth lists at different times and covered by the Investment Reporter. I bought some of this stock in April 2013 because its stock price had fallen hard. I believed the market over reacted. I just bought 100 shares as I am living off my portfolio and do not have much to invest.
When I was updating my spreadsheet, I noticed they have again changed members in both the Board and Management. Colors are going the opposite way you might want as they are going from Green and Blue to Blue and Red.
The dividend yield is low and has mostly always been low. The current yield is 1.19% with 5, 10 and historical yields at 1.04%, 1.06% and 0.98%. Dividends have increased as well as decreased over time. Over the past 5 years, dividends are now by 21% per year. However, the last increase was for 33%. They gave out a special higher dividend in early this year, but the normal dividend going forward will be $0.04 which is an increase of 33%.
The Dividend Payout Ratios cannot be determined when there are earning losses. The DPR for EPS for 2017 was 10% and the DPR for EPS for 2019 is expected to be 22%. I cannot calculate the DPR 5 year coverage for EPS because of EPS losses. The DPR for CFPS for 2018 is low at 8% with 5 year coverage at 7%.
Debt Ratios are fine. The Long Term Debt/Market Cap Ratio for 2018 is fine at 0.36. The Liquidity Ratio for 2018 is good 2.38 with a 5 year median at 2.68. The Debt Ratio for 2018 is fine at 1.71 with 5 year median at 1.69. The Leverage and Debt/Equity Ratios are fine at 2.98 and 1.74 for 2018 with 5 year medians at 2.75 and 1.56.
The Total Return per year is shown below for years of 5 to 31 to the end of 2018 in CDN$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See charts below.
Of course, it does not matter much which currency you use, long term shareholders have not done very well in this stock for lately. The stock is some 67% off the peak of 2010.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2013 | 5 | -20.99% | 0.61% | -0.30% | 0.91% |
| 2008 | 10 | -10.38% | -7.40% | -8.48% | 1.09% |
| 2003 | 15 | -3.61% | -1.73% | -3.14% | 1.41% |
| 1998 | 20 | -2.59% | -0.97% | -2.37% | 1.40% |
| 1993 | 25 | 1.75% | -1.65% | -2.81% | 1.16% |
| 1988 | 30 | 6.63% | 7.23% | 4.51% | 2.72% |
| 1987 | 31 | 8.51% | 5.50% | 3.29% | 2.20% |
The Total Return per year is shown below for years of 5 to 32 to the end of 2018 in US$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See charts below.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2013 | 5 | -24.83% | -9.05% | -9.75% | 0.71% |
| 2008 | 10 | -11.34% | -8.25% | -9.51% | 1.26% |
| 2003 | 15 | -3.96% | -1.68% | -3.39% | 1.71% |
| 1998 | 20 | -2.01% | 0.19% | -1.58% | 1.77% |
| 1993 | 25 | 1.64% | -1.60% | -2.92% | 1.31% |
| 1988 | 30 | 6.15% | 6.75% | 4.07% | 2.68% |
| 1986 | 32 | 8.35% | 9.83% | 6.35% | 3.48% |
The 5 year low, median, and high median Price/Earnings per Share Ratios are -2.34, -3.58 and -4.81. The 10 year corresponding ratios are -1.84, -2.95 and -4.05. The corresponding historical ratios are 14.38, 16.63 and 18.74. The current P/E Ratio is 38.34 based on a stock price of $17.91 and $0.47 EPS. This is in CDN$. Only the historical ratios make any sense. On this basis the stock price is relatively expensive.
I get a Graham Price of $9.65 CDN$. The 10 year low, median, and high median Price/Graham Price Ratios are 0.86, 1.12 and 1.40 CDN$. The current P/GP Ratio is 1.86 based on a stock price of $17.91 CDN$. This stock price testing suggests that the stock price is relatively expensive.
I get a 10 year median Price/Book Value per Share Ratio of 2.12 US$. The current P/B Ratio is 2.06 US$ based on Book Value of $16,358M, Book Value per Share of $8.87 and a stock price of $13.42 all in US$. The current ratio is some 3% below the 10 year median ratio. This the stock price testing suggests that the stock price is relatively reasonable but below the median. You will get a similar answer in CDN$.
I get an historical median dividend yield of 1.04% US$. The current dividend yield is 1.19% based on a stock price of $13.42 and dividends of $0.16 all in US$. The current dividend is 15% above the historical dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median.
The 10 year median Price/Sales (Revenue) Ratio is 2.34 US$. The current P/S Ratio is 1.88 based on 2019 Revenue estimate of $8,315M, Revenue per Share of $7.12 and a stock price of $13.42 all in US$. The current ratio is 19% below the 10 year median ratio. On this basis the stock price is relatively reasonable and below the median. You will get a similar answer in CDN$.
Results of stock price testing is showing lots of different results. However, the P/E Ratio test is suspect because of the earning losses. A problem with the dividend yield test is that dividends have been inconsistent. On the other hand, the ability to pay dividends is material, but it is hard to tell if they can afford dividends, except via the CFPS. There are no problems with the P/B Ratio or P/S Ratio tests. Both these show that the stock price is reasonable and below the median.
When I look at analysts’ recommendations, I find Buy (4), Hold (14) and Underperform (1). The consensus would be a Hold. The 12 month stock price consensus is $15.67 US$ or $20.89 CDN$. This implies a total return of 17.81% with 16.62% from capital gains and 1.19% from dividends.
News Release from Barrick on joint venture with Newmont Forge. See what analysts are saying about this company on Stock Chase. Most entries are negative. Ryan Vanzo on Motley Fool likes the stock but thinks it is overvalued. A writer on Simply Wall Street talks about the company being financially sound. Adam Hewison on INO Com thinks this stock is going to go higher.
Based in Toronto, Barrick Gold is one of the world's largest gold producers, operating mines in North America, South America, Australia, and Africa. In 2018, the firm produced roughly 4.5 million attributable ounces of gold and more than 380 million pounds of copper. Its web site is here Barrick Gold Corp.
The last stock I wrote about was about was Leon's Furniture Ltd (TSX-LNF, OTC-LEFUF) ... learn more. The next stock I will write about will be Pembina Pipelines Corp (TSX-PPL, NYSE-PBA) ... learn more on Wednesday, April 17, 2019 around 5 pm. Tomorrow on my other blog I will write about Energy and Pollution.... learn more on Tuesday, April 16, 2019 around 5 pm.
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