Barrick Revises Outlook but May Have Bottomed

Source: Adrian Day 12/12/2024

Global Analyst Adrian Day reviews forecasts and developments at companies on his list.

Barrick Gold Corp.’s (ABX:TSX; GOLD:NYSE) latest 5-year projections show gold production recovering from 2024′s expected 3.9M ounces to 4.7M ounces by 2029, though down from 5.5M post-merger levels.

Copper production is set to double through Ghana and Pakistan expansions despite higher Reko Diq capital requirements. More conservative guidance could rebuild investor confidence after consistent target misses.

The situation in Mali remains tense with four employees detained amid $417M tax dispute. However, the stock trades at 0.6x NAV versus peer average of 1x and remains cheap with a formidable balance sheet. Not enough institutions own it.

Buy.

Nestlé Outlines Cost-Focused Strategy

Nestle SA’s (NESN:VX; NSRGY:OTC) management presented cost-saving initiatives and a 9% sales allocation to marketing. Water and premium beverages will become standalone divisions.

The focus will be on turning around U.S. frozen foods and Health Science units.

The stock has been down 40% since 2022 and now yields 3.9% — the highest in 30 years. Dividend growth has been maintained since 1996.

I consider it undervalued, and we will accumulate at these levels and perhaps become more aggressive in the future.

Fox River Gains Strategic Investor

Fox River Resources Corp. (FOX:CNSX) reported that an unnamed investor acquired a 9.9% stake through a CA$0.40 private placement, adding CA$2.9M to advance the Martison Phosphate Project.

We are optimistic about this development as it gives further validation for the company, while also adding to the company’s treasury.

Currently, the stock is thinly traded, so we suggest you don’t chase it.

Orogen Reports Revenue Growth

Orogen Royalties Inc.’s (OGN:TSX.V) announced that its Ermitaño royalty revenue was up to $2.1M from $1.6M year-over-year.

The operating cash flow increased to $948,000 from $715,000. However, net income lowered from write-downs.

The operator of the mine, First Majestic Silver Corp. (FR:TSX; AG:NYSE; FMV:FSE) has been exploring the royalty land.

Buy on upcoming weakness.

Lara Exploration Strengthens Treasury

Lara Exploration Ltd. (LRA:TSX.V) raised a little over CA$3M through warrant exercise.

This brought its cash to CA$5.6M.

The company is currently well-positioned to advance its Planalto copper project, with incoming revenue from the recently resumed Celesta copper project.

While in a good position to advance the Planalto copper project, Lara is a Buy.

Franco-Nevada Sees Hope for Cobre Restart

Franco-Nevada Corp. (FNV:TSX; FNV:NYSE) reported that Panama’s president signaled an early 2024 focus on reopening the Cobre mine after an environmental audit. This audit would address the public’s concerns.

The mine previously contributed 19% of Franco’s revenue. The current valuation assumes zero Cobre value, presenting upside potential.

Franco-Nevada has a strong balance sheet with $1.4 billion in cash. The company is solid.

Buy.

TOP BUYS this week include Kingsmen Creatives Ltd. (KMEN:SI), Pan American Silver Corp. (PAAS:TSX; PAAS:NASDAQ), and Metalla Royalty & Streaming Ltd. (MTA:TSX.V; MTA:NYSE American).

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Important Disclosures:

1. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Barrick Gold Corp., Fox Riv Res Corp., Orogen Royalties Inc., Lara Exploration Ltd., Franco-Nevada Corp., Pan American Silver Corp., and Metalla Royalty & Streaming.
2. Adrian Day: I, or members of my immediate household or family, own securities of: All. My company has a financial relationship with: All. I determined which companies would be included in this article based on my research and understanding of the sector.
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Adrian Day’s Global Analyst is distributed for $990 per year by Investment Consultants International, Ltd., P.O. Box 6644, Annapolis, MD 21401. (410) 224-8885. www.AdrianDayGlobalAnalyst.com. Publisher: Adrian Day. Owner: Investment Consultants International, Ltd. Staff may have positions in securities discussed herein. Adrian Day is also President of Global Strategic Management (GSM), a registered investment advisor, and a separate company from this service. In his capacity as GSM president, Adrian Day may be buying or selling for clients securities recommended herein concurrently, before or after recommendations herein, and may be acting for clients in a manner contrary to recommendations herein. This is not a solicitation for GSM. Views herein are the editor’s opinion and not fact. All information is believed to be correct, but its accuracy cannot be guaranteed. The owner and editor are not responsible for errors and omissions. © 2023. Adrian Day’s Global Analyst. Information and advice herein are intended purely for the subscriber’s own account. Under no circumstances may any part of a Global Analyst e-mail be copied or distributed without prior written permission of the editor. Given the nature of this service, we will pursue any violations aggressively.

( Companies Mentioned: ABX:TSX; GOLD:NYSE, FOX:CNSX, FNV:TSX; FNV:NYSE, LRA:TSX.V, NESN:VX; NSRGY:OTC, OGN:TSX.V, )

Source: https://www.streetwisereports.com/article/2024/12/12/barrick-revises-outlook-but-may-have-bottomed.html