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Gold miners are thought of as leveraged plays on the metal, yet Barrick shares are up just 3% this year while gold is up more than 10% to $2,036 an ounce. Blame higher costs and lower-than-expected gold production.
Barrick has several things going for it. The company has some of the world’s best mines in spots like Nevada and the Dominican Republic, and it’s the top gold producer in Africa. It aims to boost its mine output—mostly gold and some copper—by 30% by the end of the decade.
It has the industry’s most effective leader in CEO Mark Bristow, a swashbuckling South African and hands-on manager who visits each major mine at least three times a year. He also has a knack for handling delicate relations with host countries in the developing world.
“Barrick probably has the best management in the mining business, an excellent balance sheet with virtually no net debt, and a well-covered 2.3% dividend yield,” says independent analyst Keith Trauner. The stock trades for about 16 times next year’s projected earnings.