Earnings call transcript: Barrick Gold's Q2 2025 EPS hits highest since 2013

Barrick Gold Corp reported strong Q2 2025 earnings, with adjusted EPS reaching $0.47, its highest since 2013, and operating cash flow surging 35% quarter-over-quarter to €1.33 billion. The company returned $753 million to shareholders and reiterated its commitment to a $1 billion share buyback program, signaling management confidence despite the stock trading 60% below its 52-week high. Barrick anticipates a stronger second half of 2025 with increased production, targeting 30% organic growth in gold and copper by 2029, bolstered by key projects like Fourmile and a unanimous analyst 'BUY' rating.

Analysis

Barrick Gold Corp. (ABX/GOLD) reported a robust Q2 2025, marked by its highest adjusted earnings per share (EPS) of $0.47 since 2013 and a 35% quarter-over-quarter surge in operating cash flow to €1.33 billion. This strong financial performance, however, contrasts sharply with the stock's market valuation, which currently sits 60% below its 52-week high with a year-to-date return of -42.4%. Management is actively signaling its belief in this valuation disconnect by committing to a $1 billion share buyback program, having already returned $753 million to shareholders in the first half through dividends and buybacks. The company's forward guidance is optimistic, anticipating a stronger second half with increased production, lower all-in sustaining costs, and a long-term target of 30% organic growth in gold and copper production by 2029. This growth is underpinned by significant progress at key projects, most notably the Fourmile discovery, which management describes as a potential generational, high-grade asset poised to enhance the Nevada Gold Mines complex. While geopolitical risks, such as the Lulu Gonkoto arbitration in Mali, persist, the company has de-risked its balance sheet by deconsolidating the asset, with the resulting write-off being offset by a gain on the sale of the Donlin Gold project. This operational momentum and strategic asset development are supported by a unanimous 'BUY' consensus from analysts, who project a price target of $6.51, implying significant upside potential from its recent close of $3.36.

Key Decisions for Investors

• Investors should evaluate the significant disconnect between Barrick's strong operational performance and positive outlook versus its depressed stock price, which management is actively addressing through a $1 billion share buyback program.
• Closely monitor progress at the Fourmile project, as continued positive drilling results and development milestones could act as a significant re-rating catalyst, given its potential to substantially increase high-grade resources within existing infrastructure.
• Assess the company's ability to deliver on its guidance for a stronger second half with higher production and lower costs, as execution will be key to validating the bullish thesis and closing the valuation gap.
• While the financial impact of the Lulu Gonkoto arbitration appears contained for now through asset deconsolidation, this remains a key geopolitical risk to track alongside general commodity price volatility.