Shares of Barrick Gold have delivered a spectacular performance over the past year, nearly tripling in value. However, a recent reassessment by Zacks Research has introduced a note of caution into the prevailing market euphoria. This move raises a pivotal question for investors: has the stock’s valuation run ahead of its underlying reality, or do its robust fundamentals provide a solid foundation for continued strength?
Robust Operations and a Key Resolution
Fundamentally, Barrick presents a picture of considerable strength. The company’s third-quarter results exceeded expectations, with earnings per share beating forecasts and revenue climbing by over 23 percent. A standout metric was the 233 percent year-over-year surge in free cash flow, showcasing impressive cash generation. This financial power is being actively deployed through a $1.5 billion share buyback program.
Furthermore, Barrick successfully neutralized a significant operational risk late in 2025. The protracted dispute with the government of Mali concerning the Loulo-Gounkoto complex was settled. In exchange for a settlement payment of $430 million, production is scheduled to resume normally in 2026, removing a major overhang for the stock.
Market Sentiment Cools Amid Downgrade and Gold Pullback
The primary catalyst for the current cautious sentiment is the rating action from Zacks Research. On January 15, the firm downgraded Barrick from “Strong-Buy” to “Hold.” While the broader analyst consensus still leans toward a “Moderate Buy,” Zacks’ step highlights growing skepticism. Following the massive rally, it appears much of the positive outlook may already be reflected in the share price.
Should investors sell immediately? Or is it worth buying Barrick?
This reassessment coincides with a correction in the commodity markets. The gold price has retreated from its recent historic peaks, trading around the $4,600 level. This pullback was triggered by a slight easing of geopolitical tensions and profit-taking by investors. As a major gold producer, Barrick’s stock acts as a leveraged play on the gold price, leading some shareholders to capitalize on gains.
Valuation and Forward-Looking Potential
Interestingly, despite the steep ascent—with shares trading at €42.78, just shy of their all-time high—certain valuation models suggest there may be room for further growth. A low PEG ratio (Price/Earnings to Growth ratio) of 0.42 indicates the stock could still be reasonably valued relative to its growth prospects.
Market experts project earnings growth of approximately 48 percent for the current year, 2026. Provided the gold price maintains a floor above $4,500, the macroeconomic environment remains favorable for Barrick to continue generating record cash flows. This fundamental strength could ultimately serve to counter the near-term skepticism implied by the Zacks downgrade over the long term.
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