Is Barrick Gold Stock Trading at a Discount to Its True Worth?

Barrick Gold's DCF valuation suggests a $53 intrinsic value vs. a $41.64 share price. Strong Q4 earnings, a 40% dividend hike, and copper growth face a setback at Reko Diq.

Despite posting robust quarterly earnings, implementing a substantial dividend hike, and seeing its share price surge more than 140% over the past year, Barrick Gold Corporation's equity may still be undervalued. According to a recent discounted cash flow (DCF) valuation, the stock's intrinsic value is estimated at approximately $53 per share. With shares recently closing at $41.64, this suggests the market is applying a discount of roughly 21.5% to the company's estimated fundamental value.

A Strong Operational Finish to 2025

Barrick's operational momentum was clearly demonstrated in its Q4 2025 report. Earnings per share skyrocketed by about 151% year-over-year, supported by a 64.5% increase in revenue. The quarter saw gold production rise by 5% to 871,000 ounces. This boost was partly driven by the December 2025 resumption of operations at the Loulo-Gounkoto complex, following the recovery of operational control. The company's copper segment also showed strength, with output climbing 13% from the previous quarter to 62,000 tonnes.

In tandem with these results, the board announced a 40% increase in the quarterly dividend. Furthermore, a new returns of capital framework was established, committing up to 50% of annual free cash flow to dividends and share buybacks. Barrick's free cash flow for the trailing twelve months stood at around $3.55 billion, with projections pointing to a rise to $5.40 billion annually by 2030.

Strategic Positioning and a Key Setback

The company continues to strategically emphasize copper as a primary growth engine, exemplified by the expansion of the Lumwana Super Pit in Zambia. This focus aligns with a anticipated structural supply deficit in the copper market, which some analysts believe could persist until the end of 2028.

However, this growth trajectory faces a headwind from the massive Reko Diq project in Pakistan. Barrick has recently slowed the development pace there due to a deteriorating security situation and a comprehensive review of capital requirements, financing, and the project timeline. The outcome is likely to be significantly higher costs and a longer development period than initially planned. Whether this setback materially delays Barrick's copper growth potential depends on the findings of the ongoing project review, for which specific updated figures are not yet available.