Is it a good company at a reasonable price? I do not recommend buy resource stocks. They are mostly cyclical and not good long term buys. I do not recommend gold stocks. I have some resource just to keep track of them as they are a good part of the TSX. I have little invested in this stock. The stock price does seem to be reasonable.
I own this stock of Barrick Gold Corp (TSX-ABX, NYSE-GOLD). I have this stock to help me track gold stocks. I only have 200 shares. I have had this stock for almost 10 year and have made a total return per year of 6.01% with 3.96% from capital gains and 2.05% from dividends.
If you had invested in this company in December 2013, for $1,010.34 you would have bought 54 shares at $18.71 per share. In December 2023, after 10 years you would have received $231.22 in dividends. The stock would be worth $1,292.76. Your total return would have been $1,523.98. This would be a total return of 4.40% per year with 2.50% from capital gain and 1.90% from dividends.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $18.71 | $1,010.34 | 54 | 10 | $231.22 | $1,292.76 | $1,523.98 |
When I was updating my spreadsheet, I noticed I have had this stock for 11 years. I made two purchases in 2013 and 2016. I have a total return of 6.01%, with 3.96% from capital gains and 2.05% from dividends. Over the years, this stock has not returned much to its shareholders. See the Total Return to the end of 2023 chart in a paragraph below. The problem is that the stock hit a peak in 2011 that it has never matched again. It is now low compared to another lower peak in 2020. Also see the Total Return to the end of 2019 below.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2014 | 5 | 0.00% | 12.55% | 11.58% | 0.97% |
| 2009 | 10 | -6.70% | -6.23% | -7.23% | 1.00% |
| 2004 | 15 | -0.63% | -0.32% | -1.75% | 1.43% |
| 1999 | 20 | 0.00% | 1.83% | 0.25% | 1.58% |
| 1994 | 25 | 2.81% | 0.55% | -0.72% | 1.26% |
| 1989 | 30 | 6.53% | 4.65% | 2.89% | 1.76% |
| 1986 | 33 | 9.81% | 10.27% | 7.17% | 3.09% |
The current dividend yield is moderate with dividend growth generally low with dividend increases and decreases over the years. The current dividend yield is moderate (2% to 4% ranges) at 2.24%. The 5, 10 and historical dividend yields are low (below 2%) at 1.70%, 1.31% and 1.19%. The dividends are up by 27% per year over the past 5 years, but this is because of dividends being raised in 2017 after cuts. The 10 year dividend growth is negative 2% per year because of dividend cuts. Over the past 36 years, the company has raised dividends 23 times and decreased them 5 times. It is on the Money Sense and Dividend Aristocrat dividend lists.
The Dividend Payout Ratios (DPR) are fine. The DPR for 2023 for Earnings per Share (EPS) is fine at 56% with 5 year coverage at 46%. The DPR for 2023 for Adjusted Earnings per Share (AEPS) is fine at 48% with 5 year coverage at 59%. The DPR for 2023 for Cash Flow per Share (CFPS) is good at 14% with 5 year coverage at 16%. The DPR for 2023 for Free Cash Flow (FCF) is, of course too high at 177% with 5 year coverage fine at 53%.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 55.56% | 46.18% |
| AEPS | 47.62% | 59.42% |
| CFPS | 14.09% | 16.66% |
| FCF | 176.93% | 53.43% |
Debt Ratios are good. The Long Term Debt/Market Cap Ratio for 2023 is good at 0.15. The Liquidity Ratio for 2023 is good at 3.16. The Debt Ratio for 2023 is good at 3.32. The Leverage and Debt/Equity Ratios for 2023 are good at 1.96 and 0.59.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term R | 0.15 | 0.15 |
| Intang/GW | 0.12 | 0.12 |
| Liquidity | 3.16 | 3.16 |
| Liq. + CF | 4.44 | 4.69 |
| Debt Ratio | 3.32 | 3.32 |
| Leverage | 1.96 | 1.96 |
| D/E Ratio | 0.59 | 0.59 |
The Total Return per year is shown below for years of 5 to 37 to the end of 2023. 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 chart below.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2018 | 5 | 27.23% | 9.31% | 5.97% | 3.25% |
| 2013 | 10 | -2.21% | -0.59% | -2.21% | 1.90% |
| 2008 | 15 | 0.00% | -3.11% | -4.62% | 1.43% |
| 2003 | 20 | 3.03% | 0.63% | -1.13% | 1.57% |
| 1998 | 25 | 3.25% | 1.64% | -0.12% | 1.49% |
| 1993 | 30 | 5.51% | -0.17% | -1.49% | 1.23% |
| 1988 | 35 | 8.94% | 6.98% | 4.34% | 2.72% |
| 1986 | 37 | 10.79% | 9.79% | 6.30% | 3.45% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 15.44, 18.59 and 23.98. The corresponding 10 year ratios are 12.10, 16.39 and 19.55. The corresponding historical ratios are 18.68, 25.03 and 29.31. The current P/E Ratio is 16.41 based on a stock price of $23.38 and EPS estimate for 2024 of $1.42. The current ratio is between the median and high ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in CDN$.
I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 16.89, 20.61 and 26.49. The corresponding 10 year ratios are 17.18, 22.93 and 32.54. The current P/AEPS Ratio is 18.03 based on a stock price of $16.95 and AEPS estimate for 2024 of $0.94. The current ratio is between the low and median ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in US$ and you will get a similar result in CDN$.
I get a Graham Price of $23.25. The 10-year low, median, and high median Price/Graham Price Ratios are 0.93, 1.33 and 1.73. The current ratio is 1.01 based on a stock price of $23.38. The current ratio is between the low and median ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in CDN$
I get a 10-year median Price/Book Value per Share Ratio of 1.67. The current ratio is 1.27 based on a stock price of $16.95, Book Value of $23,341M and Book Value per Share of $13.30. The current ratio is 24% below the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$ and you will get a similar result in CDN$.
I also have a Book Value per Share (BVPS) estimate for 2024 of $13.70. This implies a ratio of $1.24 and Book Value of $24,051M with a stock price of $16.95. The current ratio is 26% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$ and you will get a similar result in CDN$.
I get a 10-year median Price/Cash Flow per Share Ratio of 8.07. The current P/CF Ratio is 6.89 based on Cash Flow per Share estimate for 2024 of $2.46, Cash Flow of $4,319M and a stock price of $16.95. The current ratio is 15% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in US$ and you will get a similar result in CDN$.
I get an historical median dividend yield of 1.19%. The current dividend yield is 2.36% based on dividends of $0.40 and a stock price of $16.95. The current dividend yield is 98% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable cheap. This testing is in US$ and you will get a similar result in CDN$.
I get a 10 year median dividend yield of 1.31%. The current dividend yield is 2.36% based on dividends of $0.40 and a stock price of $16.95. The current dividend yield is 81% above the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively reasonable cheap. This testing is in US$ and you will get a similar result in CDN$.
The 10-year median Price/Sales (Revenue) Ratio is 2.52. The current P/S Ratios is 2.36 based on Revenue estimate for 2024 of $12,610M, Revenue per Share of $7.18 and a stock price of $16.95. The current ratio is 6% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in US$ and you will get a similar result in CDN$.
Results of stock price testing is that the stock price is probably reasonable. The dividend tests are saying the stock price is cheap, but this company varies its dividend as it goes up and down. The P/S Ratio test does not confirm the cheap price showing in the dividend yield tests. Most of the other testing is showing the stock price as relatively cheap or reasonable.
When I look at analysts’ recommendations, I find Strong Buy (10), Buy (6), Hold (1) and Underperform (1). This is a fairly wide range. The consensus would be a Buy. The 12 month stock price consensus is $28.28 ($20.54 US$), with a high of $35.01 ($25.43) and low of $22.91 ($16.64). The consensus price of $28.218 implies a total return of 23.29% with 20.94% from capital gains and 2.36% from dividends.
Analyst recommendations on Stock Chase for 2024 contain two Do Not Buys, one Hold and one Weak Buy. Stock Chase gives this stock 3 stars out of 5. Aditya Raghunath on Motley Fool thinks this stock is good to own because rising tensions in Middle East should cause gold prices to rise. Joey Frenette on Motley Fool also thinks gold is going to rise in price. The company put out a press release via Newswire about its fourth quarter results. There is a report via Yahoo Finance from a site called InvestorPlace.
Simply Wall Street via Yahoo Finance reviews this stock and insider buying. Simply Wall Street give this stock 4 stars out of 5. It lists one warning of Dividend of 2.4% is not well covered by cash flows.
Based in Toronto, Barrick Gold is one of the world's largest gold miners. It operates mines in 19 countries in the Americas, Africa, the Middle East, and Asia. The company also has growing copper exposure. 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 Monday, April 22, 2024 around 5 pm.
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