Why Barrick Gold (GOLD) is a Top Value Stock for the Long-Term – November 15, 2024

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For new and old investors, taking full advantage of the stock market and investing with confidence are common goals. Zacks Premium offers many different ways to do both.

The popular research service can help you become a smarter, more confident investor by giving you access to daily updates of the Zacks Rank and Zacks Industry Rank, the Zacks #1 Rank List, Equity Research Reports, and Premium Stock Screens.

Zacks Premium also provides access to the Zacks Style Scores.

What are the Zacks Style Scores?

The Zacks Style Scores are a unique set of guidelines that rate stocks based on three popular investment types and were developed as complementary indicators to the Zacks Rank. This combination helps investors choose securities with the highest chances of beating the market over the next 30 days.

Based on their value, growth and momentum characteristics, each stock is given a rating of A, B, C, D or F. The better the score, the more likely the stock will outperform; an A is better than a B, a B is better than a C, and so on.

The style scores are divided into four categories:

Value score

Finding good stocks at good prices, and discovering which companies are trading below their true value, are what value investors like to focus on. So the Value Style Score takes into account ratios such as P/E, PEG, Price/Sales, Price/Cashflow and a host of other multiples to highlight the most attractive and competitively priced stocks.

Growth score

Growth investors, on the other hand, are more concerned about a company’s financial strength and health, as well as its future prospects. The Growth Style Score examines things like expected and historical earnings, sales and cash flow to find stocks that will experience sustainable growth over time.

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Momentum score

Momentum trading is about taking advantage of upward or downward trends in a stock’s price or earnings prospects, and these investors live by the saying “the trend is your friend.” The Momentum Style Score can pinpoint good times to build a position in a stock, using factors such as one-week price changes and the monthly percentage change in earnings estimates.

VGM score

What if you want to use all three types of investing? The VGM Score is a combination of all Style Scores, making it one of the most comprehensive indicators to use with the Zacks Rank. It rates each stock based on their combined weighted styles, helping to select the companies with the most attractive value, best growth forecast and most promising momentum.

How Style Scores Work with the Zacks Rankings

The Zacks Rank is a proprietary stock rating model that uses the power of earnings estimate revisions, or changes in a company’s earnings expectations, to help investors build a successful portfolio.

#1 stocks (Strong Buy) have delivered an unprecedented average annual return of +25.41% since 1988, which is more than double the performance of the S&P 500 during the same period. However, the Zacks Rank examines a lot of stocks, and there may be more than 200 companies with a Strong Buy ranking on any given day, and another 600 with a #2 (Buy) ranking.

This totals more than 800 top-rated stocks, and it can be overwhelming to try to choose the best stocks for you and your portfolio.

That’s where the style scores come in.

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For the best chance at big returns, always consider stocks with a Zacks Rank #1 or #2 that also have a Style Score of A or B, giving you the best chance for success. When looking at stocks with a #3 (Hold) ranking, it’s important that they also have a score of A or B to ensure as much upside potential as possible.

The direction of a stock’s earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the scores are created to work together with the Zacks Rank.

For example, a stock rated #4 (Sell) or #5 (Strong Sell) still has a downward trend in earnings expectations, and the stock price is much more likely to decline. also.

So the more stocks you own with a #1 or #2 rank and scores of A or B, the better.

Barrick Gold Corporation, based in Toronto, Canada, is one of the largest gold mining companies in the world. The company has many advanced exploration and development projects across five continents.

GOLD is a #2 (Buy) on the Zacks Rank, with a VGM Score of A.

It also boasts a Value Style Score of A thanks to attractive valuation metrics such as a price-to-earnings ratio of 13.05; value investors should be aware of this.

Five analysts have upgraded their FY 2024 earnings estimates in the past 60 days. The Zacks Consensus Estimate increased $0.09 to $1.29 per share. GOLD boasts an average earnings surprise of 16.1%.

With a solid Zacks Rank and high-quality Value and VGM Style scores, GOLD should be on investors’ shortlist.

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