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Gold/Mining/Energy : Barrick Gold (ABX) -- Ignore unavailable to you. Want to Upgrade?

To: Zardoz who wrote (1279)	6/29/1999 1:06:00 PM
From: Exsrch	Respond to of 3558

<<..Maybe you can explain to me, why so many people preferr NEM then ABX. When I see ABX a better play then NEM?..>> I agree with a 1000%. It doesn't make any sense from a value perspective for investors long on ABX. Why go long on NEM when ABX has the following: - Strong cash position with $500 million and expect $1 billion by 12/99 - No debt - For all intent and purposes has sold three years of production at $385; however, ABX is not valued if gold is $385 - Strong focus on capex to invest in lower future cash production cost - Agressive depreciation and amortization to reduce total production costs in the future (especially in Peru). - Off balance sheet asset valued at $4 billion from which they earn $200 million a year - Premier operations and unparalled financial execution The only guesss I have is that short term investors out number long term growth and value investors in ABX by some order of magnitue. Only way this will change is when joe public and other institutional investors outside mining start to notice ABX's growth and value attributes (resulting in a consistent net inflow of funds to purchase ABX). One could argue this is what might make ABX a great buy. Not recognized because very few understands how it makes money (cantango). And its ability to do so consistently with measurable and predictable earnings make it appealing to me. If you run the numbers its a no brainer for a value investor minimizing risk while perportionaly framing value creation (from an ROIC perspective) and growth (revenue, earning, costs and M&A). Your thoughts? Exsrch