Barrick Gold (NYSE:GOLD, TSX:ABX) experienced a torrent of insider buying on a single day last week. On Tuesday March 1st, Barrick insiders purchased more than C$20 million worth of Barrick Gold shares in a single trading session:
Most of these purchases are likely to be part of a predetermined 10b5-1 trading plan. However, the sheer size of the purchases by Barrick insiders and the fact that there have not been insider sales filed since last May paints a picture of a very bullish management team. Barrick management have not always been this bullish on their company's shares, it was only two years ago that Barrick Chairman John Thornton liquidated $50 million worth of Barrick shares:
Gold's 7.5% rally so far in 2022 has helped to lift ABX shares more than 25% since January. In addition, Barrick announced a $1 billion share buyback in February after reporting earnings that beat analyst estimates:
Barrick Gold (Weekly)
It has been widely reported that Barrick was in the hunt to acquire Great Bear Resources at the end of last year. However, Barrick chose not to pay a big premium to Great Bear's market price, ultimately resulting in Kinross acquiring Great bear for C$1.8 billion in cash and shares. So far it looks like Barrick is choosing to use its cash to buy back its own shares, pay a larger dividend, and pay down its debt. With Barrick's gold production declining 6.8% to 4.437 million ounces of gold in 2021 from 4.76 million ounces in 2020, it will be interesting to see how long Barrick stays on the M&A sidelines before deciding it's time to replace some of its dwindling reserves through an acquisition