Tomahawk, WI 9/17/2013 (BasicsMedia) –  Barrick Gold Corporation (USA) (NYSE:ABX) is one of the most influential companies which produces, sales, mines and explores gold. Its gold mines are primarily located in 3 regional business units, namely, North America and South America as well as the Australia Pacific. It also has copper mines located both in Zambia and Chile, while another mine is currently under construction in Saudi Arabia.  This company is the world’s largest miner of gold and in 2013 it expects to produce no less than 7.2 million ounces of gold. Is this the time to own its stock?

 ABX’s Major Competitors

 Two of the major competitors which ABX has to contend with include Goldcorp and Newmont. Just like its fellow competitors, the company has not had the best of times. Its stock is not in the best condition right now and that is due to a couple of factors, which could probably have been avoided. The first reason is the company’s decision to acquire Equinox. Secondly, the company has continued being affected by its lack of cash flow which has been brought about as a result of too much money being tied up on the Pascua Lama project.

 The third factor why ABX stock is not in the best possible state has to do with the 75% cut in dividend which the company has embarked on. While these reasons are sufficient to make an investor have a change of mind regarding whether to invest in this stock, let me be quick to mention that I think it is still a bargain. Why do I say this? Well, the fact that ABX’s operating profit thus far in 2013 is 7x, is a good reason as any as to why you need to add this stock to your portfolio. If the trend continues, this stock would prove to be a gold mine to any investor.

 Challenges Posed to ABX Stock by the Pascua Lama Project

 The Pascua Lama project is one which continues to make many investors weary about the ABX stock. This is due to the political uncertainties regarding both Chile and Argentina which are the two countries also involved in the project. There is a strong belief in some of the investors that the project may end up being nationalized as soon as it is up and running. This won’t augur well for ABX, or its investors. Some investors are also of the opinion that gold stocks traditionally never perform quite well in the long term, and this does not augur well for long-term investors.

 ABX Stock’s Performance Tied to that of Gold

 Barrick Gold Corporation USA is a very interesting stock. I believe that this stock will perform better only if gold performs in the same way. If gold does poorly, then I expect this stock to suffer primarily due to the size of the company. A close examination of gold would show that the companies which deal with its exploration or mining are often unable to keep up with the same levels of production they had in the previous year. Unfortunately, this is something which affects such companies negatively thereby causing many investors to keep off.

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