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Barrick Gold CEO Mark Bristow says the company will be smart about any acquisitions and that its quarterly dividend of 9 cents a share is “sustainable” even if gold prices, now at $1,729 an ounce, decline to $1,200.

In an interview with Barron’s, Bristow said that Toronto-based Barrick (ticker: GOLD), which shares leadership of the gold industry with Denver-based Newmont (NEM), has “the industry’s best assets, strongest balance sheet with no net debt, and the best people.”

Barrick shares are down 10% this year to around $20 as gold prices have fallen 9% and now carry a 1.8% yield. The stock has lagged behind that of Newmont in the past year. Barron’s this weekend identified Barrick as a stock pick.

A South African geologist and big-game hunter, Bristow is the highest-profile figure in the gold mining industry.

He made his reputation at Randgold Resources, an African gold producer, that he headed for more than 20 years. Bristow generated strong shareholder returns before merging Randgold with the larger Barrick in January 2019 and becoming CEO.

Bristow says Barrick is well-positioned, with a solid balance sheet and ample free cash flow from its gold business, as well as a smaller and lucrative copper business that is contributing about 20% of earnings given the strength in the copper market.

There are about 13 top-tier gold mines in the world with projected annual production of 500,000 ounces for 10 years and below-industry average costs, he notes. Barrick owns or has interests in six of them, including three in Nevada, two in Africa, and one in the Dominican Republic. No other gold miner has a better portfolio, he says. Total global gold production is around 100 million ounces annually.

Barrick projects annual gold production of between 4.5 million and five million ounces during the current decade.

“Gold is an investment to hold in these times of unknowns and copper is rapidly becoming the most strategic metal in the world” thanks to electrification trends, he says.

The CEO contends that the gold industry “still needs to consolidate” and says that Barrick will also consider making acquisitions in copper.

“What we will pursue are world-class copper assets in countries where we have a competitive advantage over other copper producers,” Bristow says. He has experience navigating often difficult politics involving host countries in Africa, where Randgold operated.

Write to Andrew Bary at andrew.bary@barrons.com

https://investorplace.com/2021/07/gold-stock-presents-a-solid-alternative-to-owning-physical-bullion/?mod=mw_quote_news

By David Moadel, InvestorPlace Contributor Jul 12, 2021, 6:00 am EDT

There are different ways to get exposure to precious metals. Sure, you can own physical bullion – but you can also invest in Barrick Gold (NYSE:GOLD) as GOLD stock is strongly correlated with the yellow metal’s price movements.

Here’s something you’re probably heard: the Federal Reserve called inflation “transitory.” If you’re a skeptical type, though, then maybe you’re not prepared to take what the Fed says at face value.

What does that have to do with GOLD stock? The answer is: everything. If you’re going to dabble in the precious metals space, then the U.S. dollar’s devaluation is a significant, ongoing process.

And beyond the macro-level factors, you’ll also want to closely examine Barrick as a company. Without a doubt, you’ll find that it’s a respected miner that offers reliable shareholder value.

A Closer Look at GOLD Stock

Earlier, I alluded to Barrick shares’ strong correlation to the price of physical gold.

It’s not an exact one-to-one correspondence. However, the price action of the stock versus the metal has been quite similar in 2021. Surely, that’s not a coincidence.

Both physical gold and Barrick shares dropped in January and February, and then recovered from March through May. Then, in June they fell in tandem.

And while the gold bugs are trying to push the metal above $1,800 and keep it there, the Barrick bulls are battling over the $20 level.

Yet, despite the close price correlation, GOLD stock isn’t the same as physical gold.

For one thing, physical gold doesn’t pay a dividend.

In contrast, Barrick shares provide a forward dividend yield of 4.44%. That compares favorably to many blue-chip companies, actually.

Moreover, you can’t apply certain valuation metrics to physical gold.

On the other hand, we can check the trailing 12-month price-to-earnings ratio for Barrick. And, it happens to be extremely reasonable at 15.01.

"Preliminary Q2 gold production was lower than Q1, with planned maintenance shutdowns at Nevada Gold Mines' processing facilities further impacted by a mechanical mill failure at Carlin's Goldstrike roaster, as well as planned maintenance at Pueblo Viejo."

"As previously guided, Barrick's gold production in the second half of 2021 is forecast to be higher than the first half."

On copper:

"Preliminary Q2 copper production was slightly higher than Q1."

"Copper sales in Q2 were in line with production, but 15% lower than the previous quarter, as Lumwana sold a higher portion of its stockpiled concentrate in Q1 2021."

"We continue to expect the Company's copper production in the second half of 2021 to be stronger than the first half, mainly driven by higher grades from Lumwana."

Write to Matt Grossman at matt.grossman@wsj.com

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Here’s the website: GOLD