Barrick Gold's Copper Ambitions Face a Critical Test

Barrick Gold's stock falls as high costs and project delays offset record gold prices. New CEO's first results and a strategic copper shift are key focal points.

Barrick Gold Corp. finds itself in a curious position. While the price of gold hovers near a historic peak of around $4,867 per ounce, the company's stock has been moving in the opposite direction. The shares closed the week at CAD 58.16, down 3.5% from the prior week and roughly 19% below their 52-week high of CAD 71.86. This disconnect sets the stage for a pivotal moment on May 11, when new CEO Mark Hill presents his first quarterly results.

A significant drag on investor sentiment stems from geopolitical complications. The company has slowed development of its massive Reko Diq copper-gold project in Pakistan, extending the review phase by twelve months due to security concerns. This delay has forced a revision of budgets and timelines, casting a shadow over a key future asset. Analyst firm Raymond James recently trimmed its price target to $61, though it maintains an Outperform rating, citing these ongoing challenges.

The Cost Challenge

Even with gold's record run, Barrick's margins are under pressure. The company's all-in sustaining costs climbed 10% in 2025 to $1,637 per ounce. Management forecasts a further increase to between $1,760 and $1,950 for 2026, meaning a substantial portion of the windfall from high gold prices is being consumed by rising expenses. The first quarter is expected to be the weakest period operationally for both gold and copper production this year, with 55% of the annual gold output forecast between 2.9 and 3.25 million ounces anticipated in the second half.

A Strategic Copper Bet

Alongside its gold operations, Barrick is aggressively pursuing a strategic shift toward copper. The centerpiece is the expansion of its Lumwana mine in Zambia into a "Super Pit." A feasibility study points to an incremental net present value of approximately $1.7 billion for the project, which aims to double average annual copper production from 120,000 tonnes to 240,000 tonnes. Construction is slated to begin in 2025, with the new processing plant expected to be operational in the second half of 2027, potentially propelling Lumwana into the ranks of the world's top 25 copper producers.

Financially, the company remains on solid ground. For the 2025 fiscal year, Barrick reported a net profit of $4.99 billion, generated $7.7 billion in operating cash flow, and saw free cash flow surge 194% to $3.9 billion. This strength allowed the board to raise the quarterly dividend to 42 cents per share and pay a special dividend of $0.42 per share in Q4 2025. A new share buyback program is not planned for 2026.

Corporate Moves and Market Signals

Another major strategic initiative involves Barrick's plan to spin off roughly 10% to 15% of its North American gold assets through an initial public offering, an effort designed to unlock value for existing shareholders. Technically, the stock's Relative Strength Index (RSI) reading of 33 suggests it is in oversold territory, which could indicate a potential for near-term stabilization. The share price closed Friday at CAD 59.35, still below its 50-day moving average of CAD 60.61.

The virtual annual meeting on May 8 will precede the crucial earnings release. The central question for CEO Hill is whether Barrick can translate historic gold prices into sustainable cash flows for shareholders, navigating seasonal weakness, escalating costs, and project delays. The market's verdict will hinge on the details revealed on May 11.