The stock of one of the world’s largest gold companies, Barrick Gold, has now undergone a 50% correction since the summer of 2020. The reason for this will be found mainly in the approx. 17% drop in the gold price. However, in these last 2 years, the company has kept its earnings (EPS always around $0.30) and also revenues (always around $3 billion) relatively constant and also always exceeded the respective expectations. In addition, the company most recently reported EBIDTA of $6.23 billion and, in contrast, debt of only $5.14 billion. The Canadian-based company has interests in numerous mines in a great many countries, including Canada, the USA, the South American continent and also some African countries. In Mali in particular, the company is investing in one of the largest mines in West Africa and thus in a steadily growing industry in this part of the continent.
The constant business figures with a falling share price and investments in promising locations could currently be good buying arguments for the share. Chart-wise, Barrick Gold is still in a downtrend, but has reached the lower side of the downtrend channel and is currently at an important support.
Currently, I expect a new upward movement towards $24.00, where the top of the channel is located. Otherwise, the share price could break out of the downward channel to the downside and head for $13.00. As confirmation for the rise theory, I see the slight recovery in the S&P500 from Friday, whereby U.S. stocks in general have closed mainly in the plus and which could be continued today. Most importantly, gold respected a key support at around $1700 and rose almost 1% today.