Yahoo Finance Barrick (GOLD) to Report Q1 Earnings: What's in the Offing?
Barrick Gold Corporation GOLD is scheduled to report first-quarter 2023 results before the opening bell on May 3.
The gold mining giant surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average being 11%. It posted an earnings surprise of 8.3% in the last reported quarter. The company’s first-quarter results are expected to reflect the impacts of lower gold production and higher costs. Improved gold prices are likely to have aided its performance.
The stock is down 15.2% in the past year compared with the industry’s 0.4% rise.
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Let’s see how things are shaping up for this announcement.
What Do the Estimates Say?
Barrick, last month, announced preliminary results for the first quarter. It reported first-quarter production of 0.95 million ounces of gold and 88 million pounds of copper. It also reported sales of 0.95 million ounces of gold and 89 million pounds of copper.
The company’s average market price of $1,890 per ounce for gold and $4.05 per pound for copper in the first quarter.
Cost of sales for gold for the first quarter is projected to be 3-5% higher than the fourth quarter and the total cash cost is forecast to be 13-15% higher than the prior quarter. The company expects its all-in sustaining costs per ounce to be 9-11% higher than the fourth quarter.
The Zacks Consensus Estimate for first-quarter consolidated revenues for Barrick is currently pegged at $3,208 million, which calls for a rise of around 12.4% year over year.
Some Factors to Watch For
Weaker gold production is likely have impacted the company’s performance in the quarter to be reported. Its preliminary gold production in the first quarter was lower than the fourth quarter. The lower production was mainly due to reduced output at Carlin resulting from annual roaster maintenance, which led to a fall in throughput at Goldstrike.
Additionally, the conversion of the Goldstrike autoclave to a conventional carbon-in-leach process and severe winter weather in northern Nevada adversely impacted operations, resulting in a decline in production. At Kibali, lower grades were observed due to mine sequencing. Copper production was also lower sequentially due to decreased output at Lumwana and Zaldivar.
Higher costs are also likely to have weighed on the company’s margins in the first quarter. Barrick noted that the increase in total cash costs per ounce for gold in the first quarter was due to the lower ounces produced and sold in the quarter compared to the previous quarter. Moreover, the increase in all-in sustaining costs per ounce was due to lower sales volumes, partly offset by a fall in sustaining capital expenditures.
Meanwhile, gold prices broke above the $1,800 per ounce level in December 2022 as signs of cooling U.S. inflation raised expectations of a less aggressive policy stance by the Federal Reserve. Prices of the yellow metal were up around 10% in the fourth quarter. The momentum continued through January 2023, with the yellow metal crossing $1,900 riding on a weaker U.S dollar.
However, gold prices lost steam in February, as strong U.S. economic data propelled yields and the U.S. dollar higher. Prices, nevertheless, rebounded strongly in March, driven by the fall in the value of the U.S. dollar after the sudden collapse of Silicon Valley Bank that led skittish investors flock to safe-haven assets.
Gold gained on speculation that the banking crisis will trigger less-aggressive Federal Reserve rate hikes. Prices of the yellow metal were up nearly 8% in the first quarter.
The benefits of improved gold prices are expected to reflect on Barrick’s performance in the March quarter. Notably, the average market price for gold for the first quarter, as reported by the company, reflects a roughly 9% rise from $1,728 per ounce it had recorded in the prior quarter.
Barrick Gold Corporation Price and EPS Surprise
Barrick Gold Corporation price-eps-surprise | Barrick Gold Corporation Quote
Zacks Model
Our proven model does not conclusively predict an earnings beat for Barrick this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for Barrick is -6.94%. The Zacks Consensus Estimate for earnings for the first quarter is currently pegged at 12 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Barrick currently carries a Zacks Rank #3.
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider, as our model shows these have the right combination of elements to post an earnings beat this quarter:
Koppers Holdings Inc. KOP, slated to release earnings on May 5, has an Earnings ESP of +12.66%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Koppers’ earnings for the first quarter is pegged at 76 cents. KOP currently carries a Zacks Rank #3.
Air Products and Chemicals, Inc. APD, slated to release earnings on May 9, has an Earnings ESP of +2.25%.
The consensus estimate for Air Products’ earnings for the fiscal second quarter is currently pegged at $2.64. APD currently carries a Zacks Rank #3.
Pan American Silver Corp. PAAS, scheduled to release earnings on May 10, has an Earnings ESP of +28.57% and currently carries a Zacks Rank #2.
The Zacks Consensus Estimate for Pan American Silver’s first-quarter earnings has been revised 133.3% upward in the past 60 days. The consensus estimate for PAAS’ earnings for the first quarter is currently pegged at 7 cents.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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Air Products and Chemicals, Inc. (APD) : Free Stock Analysis Report
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Barrick Gold Corporation (GOLD) : Free Stock Analysis Report
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