Is Barrick Gold Stock a Buy in 2024?

Do you hold one or more precious metal stocks in your portfolio? Precious metal investments such as Barrick Gold Corporation (TSX: ABX) can be intriguing options. In fact, investing in Barrick Gold stock right now might be a great long-term investment to consider.

For those unfamiliar with Barrick Gold stock, the company is one of the largest precious metals miners on the planet.

Specifically, Barrick has active operations in over 18 countries across four continents. Barrick also boasts a handful of in-development mines. That impressive portfolio includes both gold and copper mines.

One of the most attractive parts of considering Barrick Gold stock is the precious metal itself. Gold has been used as a safe store of wealth for millennia. Whenever there’s conflict, investors retreat to the perceived safety of precious metals.

And with more than ample conflict around the world, gold prices have surged in the past few years. During that same period, established miners like Barrick have continued to invest in growth while keeping costs down.

The result is an intriguing investment opportunity.

Barrick offers income potential as well as growth

One of the things that few investors may realize is that owning Barrick Gold stock can provide income as well as growth.

Barrick offers investors a juicy quarterly dividend that currently offers a yield of 2.25%. Rather than paying out a fixed amount like other stocks, Barrick’s dividend is tied to the company’s overall performance.

The dividend policy, which was enacted in 2022 allows Barrick to share its gains with shareholders when times are good. It also means that when some fiscal tightening is required, that dividend may shrink to prioritize a strong balance sheet.

This means that Barrick can continue to invest in growth initiatives, such as developing new mines to ensure future revenues continue to grow while offering a juicy yield.

Turning to growth, there are several key points that prospective investors should take into consideration.

First, we have the stock itself, which has remained flat despite the huge surge in gold prices (more on that in a moment).

In fact, year to date the stock has appreciated less than 2%, and over the trailing two-year period Barrick Gold stock has dropped nearly 9%.

In short, the current strong demand for precious metals coupled with the discounted stock price of Barrick makes a perfect storm for long-term investors.

Let’s not forget that Barrick has a US$1 billion share buyback program running over the next year that will drive further growth.

Should you buy Barrick Gold stock?

No stock, even the most defensive is without some risk. And precious metal stocks like Barrick are not immune to the volatility around gold prices.

Fortunately, gold prices have surged over the past few years. As of the time of writing, gold is well above US$2,400 per ounce. That represents a whopping 21% uptick over the trailing 12 months and a near 90% gain over the past five years.

And perhaps best of all, overall market volatility could continue to drive that still higher. This translates into huge growth potential for precious metals miners like Barrick Gold stock.

In my opinion, a small position in Barrick Gold stock is a must-have as part of any well-diversified long-term portfolio.