Can Barrick Mining's $2B Lumwana Expansion Power a New Era of Growth?
The Super Pit expansion entails doubling the present process circuit's throughput and substantially boosting mining volumes. Upon completion, the project has the potential to transform Lumwana into a long-term, high-yielding, top-25 copper producer and Tier One copper mine.
The expansion project will double Lumwana's copper output to 240,000 tons annually, supported by a new processing plant with a capacity of 50 million tons per year. Construction at the site is in progress, long-lead equipment has been ordered and infrastructure improvements, including a new power transmission system in collaboration with ZESCO, are advancing to benefit both the mine and the surrounding region.
The advancements at Lumwana are significant for future growth as Barrick remains entangled in a dispute with the Malian government over dividing the economic benefits from its Loulo-Gounkoto gold mine complex. Barrick also remains on track with its other high-return growth projects, underscoring a disciplined strategy that could reshape its production profile over the next decade. These assets are poised to deliver significant, low-cost production growth, enhancing Barrick's diversification and free cash flow profile should it execute these on schedule and within budget.
Among its major peers, Newmont Corporation NEM continues to invest in growth projects in a calculated manner. Newmont is pursuing several projects, including Tanami Expansion 2 in Australia, the Ahafo North expansion in Ghana and Cadia Panel Caves in Australia. These projects should expand production capacity and extend mine life, driving Newmont's revenues and profits.
Agnico Eagle Mines Limited AEM is also making steady progress with its key value drivers and pipeline projects, including the Odyssey project in the Canadian Malartic Complex, Detour Lake, Hope Bay, Upper Beaver and San Nicolas. Agnico Eagle's Hope Bay project is expected to play a significant role in generating cash flow in the years to come. At Canadian Malartic, Agnico Eagle is advancing the transition to underground mining with the construction of the Odyssey mine and executing other opportunities to beef up annual production.
B's Price Performance, Valuation & Estimates
Barrick's shares have surged 37% year to date compared with the Zacks Mining – Gold industry's rise of 53%, courtesy of the gold price rally.
From a valuation standpoint, B is currently trading at a forward 12-month earnings multiple of 9.8, a roughly 22.3% discount when stacked up with the industry average of 12.61X. It carries a Value Score of A.
The Zacks Consensus Estimate for B's 2025 and 2026 earnings implies a year-over-year rise of 52.4% and 23.8%, respectively. The EPS estimates for 2025 and 2026 have been trending higher over the past 60 days.
B stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
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Newmont Corporation (NEM): Free Stock Analysis Report
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