Executive Chairman of Barrick Gold Raises Ownership to 5 Million Shares
- By Alberto Abaterusso
Barrick Gold Corp. (ABX) closed up 0.54% to $11.14 per share Monday on the heels that the executive chairman of the Canadian gold mining company John L. Thornton has nearly doubled his holding to 5 million shares.
Barrick Gold Corp. said that Thornton has purchased an additional volume of 2,271,029 ordinary shares at an average share price of $11.11.
Warning! GuruFocus has detected 4 Warning Signs with ABX. Click here to check it out.
The intrinsic value of ABX
This kind of information is important to investors because it may prefigure a stock appreciation. All people who are working at Barrick Gold Corp. are receiving ordinary shares of their own company on a yearly basis according to the Global Barrick Share Plan that was launched in 2016. But the allocation is tied to the performance of the company. This means that executives and other employees of Barrick Gold are motivated to act in the interest of their own company and therefore in that of the stakeholders.
Barrick Gold has a recommendation rating of 2.9 out of 5 and an average target price of $14.15 per share on the New York Stock Exchange. The recommendation rating is a result of 24 surveys, and the average target price is the mean of 20 in the range of $11 to $18.
Despite yesterday's jump the stock still looks cheap. The share price of $11.11 at close Oct. 1 is below the 200- and 100-day simple moving average lines though slightly above the 50-SMA line. The 52-week range is $9.53 to $16.84. Barrick Gold has a market capitalization of approximately $12.9 billion.
Other indicators on the stock:
The 14-day Relative Strength Index is 61.13 of a historical 30 to 70 range.
The price-book ratio is 1.36 versus an industry median of 1.74.
The EV-to-Ebitda ratio is 8.67 versus an industry median of 9.3.
GuruFocus has assigned a financial strength rating of 5 out of 10.
GuruFocus has assigned a profitability & growth rating of 4 out of 10.
Barrick Gold is reporting 1,167.59 million shares of which 51.99% is held by institutions.
Amid the top fund holders, the Van Eck Associates Corp. is the largest with 4.51% of total shares outstanding. After that, Flossbach Von Storch AG holds 4.15%, First Eagle Investment (Trades, Portfolio) holds 3.14% and Franklin Resources Inc. holds 2.98%.
In addition, the company has informed the market that Mark Bristow will be appointed as president and CEO following the completion of the stock-for-stock merger with Randgold Resources Ltd. (GOLD).
Mark Bristow will see his common ownership in Randgold Resources Ltd. converted into 5,141,600 common shares of Barrick Gold Corp. The conversion ratio is one share of Randgold Resources to 6.128 new shares of Barrick Gold Corp. Currently, Bristow is the chief executive of Randgold Resources. The executive has held the position since the incorporation of Randgold Resources in 1995.
Disclosure: I have no positions in any security mentioned in this article.
This article first appeared on GuruFocus.
Warning! GuruFocus has detected 4 Warning Signs with ABX. Click here to check it out.
The intrinsic value of ABX
