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Barrick Gold Corporation Message Board

  • investora2z investora2z Apr 23, 2013 9:57 AM Flag

    At 2008 lows

    The decline in prices of the precious metals has had a strong negative impact on the stock. ABX has been on the declines since September 2011 when it made its high of $55. Recently, the stock has crashed pretty quickly with the move from $30 to $18 coming in less than one month. Now it is trading below its 2008 low, and it is extremely important for the stock to rebound immediately. The cut can be 20% deeper if this does not hold. It is expected that it will show some strength on the back of hope that the precious metals may have bottomed. However, till there is a signal on this front with a few weeks of consolidation on the gold charts, one can not get too confident. The stock can work its way up slowly only after there is a rebound in gold. The volumes have supported the fall with the 10 day average being 41 million shares compared with 14.5 million for the 3 month average. Such force and momentum can not stop in a few days. Having said this, the fact that it is available at a discount to book value (P/B 0.83) one can expect a bounce (dead cat?). Normally, such frightening times are the best to start building a position but people avoid catching a falling knife. For ABX, however, it may be a good time to look for gold / copper assets which may be available at a discount. The development stage companies Pershing Gold Corporation (PGLC) has been in the news recently because it is about to start production in 2014. The stock is available at very low valuations now and even Coeur D'Alene Mines (CDE) purchased a stake in the company as part of its long term strategic plans. For ABX investors, let us hope $17.50 holds.

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16.85+0.20(+1.20%)Oct 27 4:00 PMEDT