Barrick Mining, Desert Gold, Aura Minerals – Epic rally with no end in sight

Barrick Mining – Analysts hail Fourmile Deposit as the opportunity of the century

It took a long time for the giant to follow the underlying gold price, but in recent weeks, Barrick shares have significantly outperformed. Since the beginning of the year, the stock has gained around 125% to USD 34.48, which is a 13-year high. The trigger for the rise in recent days is the preliminary project assessment of the Fourmile Gold project in Nevada, which is now emerging as a potential game-changer for the Canadian mining giant.

CEO Mark Bristow expects the mine to have a life of over 25 years and annual production of up to 750,000 ounces of gold. Barrick estimates the investment costs at USD 1.5 to 1.7 billion. CIBC analysts subsequently raised their price target from USD 22 to USD 30, while TD Cowen sees Fourmile as a "groundbreaking project" and assigned a price tag of USD 38 to Barrick shares.

RBC Capital Markets forecasts initial production to begin in 2029 and full operation by 2034. According to RBC, the priced-in effects raise the net asset value by around 8%. Meanwhile, the record gold price is helping to fuel the news flow surrounding exploration projects.

Barrick is also delivering operationally. With adjusted Q2 earnings of USD 0.47 per share and free cash flow of USD 395 million, it is in line with expectations. At the same time, the Company is selling non-strategic assets such as the Hemlo mine for around USD 1.09 billion and pushing ahead with new gold and copper projects.

Desert Gold Ventures – Latecomer with enormous potential

The gold boom is still passing many smaller exploration companies by, but if the rally continues, which is to be expected given the conditions described above, these companies are likely to exploit their upside potential and follow suit with leverage on the strike price. One possible candidate for outperformance is Desert Gold Ventures, a Canadian company with a market capitalization of CAD 20.22 million.

The Company already offers significant upside. Its flagship SMSZ project in Mali alone hosts total resources of 1.079 million ounces of gold. A preliminary economic assessment (PEA) of the Barani and Gourbassi sub-projects shows attractive key figures. At a conservative USD 2,500 per ounce, the project carries a net present value (NPV) of USD 24 million, with a payback period of 3.25 years. In a more optimistic scenario with higher gold prices, the NPV rises to up to USD 54 million with a payback period of only 2.5 years. In other words, SMSZ has the potential to deliver strong cash flow on the back of relatively modest capital requirements.

At the same time, the focus is on the future. In Côte d'Ivoire, Desert Gold is now starting the first exploration phase on the 297 sq km Tiegba project. This area is located in the prolific Tehini Gold Belt, a region with known reserves of over 7 million ounces. CEO Jared Scharf says the project is "ripe for discovery" and points to its structural similarity with the large Bonikro/Agbaou mining complexes.

The planned work includes 3,500 soil samples, high-resolution aeromagnetic drone surveys, and initial air core drilling through 2026. Particularly exciting are the geological structures that indicate several kilometers of shear corridors and various gold traps. No test drilling has been conducted in the area to date, making Tiegba a potential pioneer discovery. If a larger system is proven, the Company would suddenly no longer be seen as a laggard in the West African gold sector, but rather as a prime candidate for rapid revaluation.

Aura Minerals – Turbo growth and valuation discount

The Aura Minerals share price has performed significantly better. Since January 2024, the share has posted a 400% performance on the trading floor. However, at USD 34.65, the Company, which is valued at USD 2.86 billion, is still below the price targets of various analysts.

Bank of America recently issued a "Buy" recommendation and set the price target at USD 40, representing an upside potential of around 15% from the current price level.

What sets Aura Minerals apart from its peer group is its above-average production growth: by 2027, gold production is expected to increase by 86% to 440,000 ounces, far exceeding the industry norm of 10%. This is made possible by the targeted expansion of cost-efficient mines. The Company is already below the global AISC average, with only USD 1,301 per ounce expected for 2026 and only USD 1,095 for 2027.

The Company's balance sheet is also impressive. Net debt is expected to fall to just USD 31 million by the end of 2025. A year later, a net cash position of USD 177 million is already forecast. This would make Aura debt-free and strategically flexible.

Gold reserves have increased by 81% to 2.8 million ounces since 2017, while production has grown by 53%. Despite these figures, experts say the stock is trading at a valuation discount of around 30% compared to comparable mid-tier and junior producers.

The gold rally continues unabated, with Barrick Mining significantly outperforming the market in recent weeks. Despite the recent surge, Bank of America remains bullish on Aura Minerals. Desert Gold holds several promising properties and has strong multiplication potential.