Hi there,
Barrick Gold is one of the best gold stocks in the country and we are big fans of Kirkland Lake. I don't think you can go wrong with either of them.
In terms of valuation, Barrick is trading at only 1.49 times book value whereas KL has a book value of 2.78. On an earnings basis, Kirkland Lake looks much cheaper with a P/E of 15.34 and a forward P/E of 14.68 (ABX 37.28 and 29.34) and its PEG ratio of 1.61 is 0.20 lower than that of Barrick.
In terms of growth, ABX and KL are expected to grow earnings by 27.52% and 22.83% and revenue by 4.71% and 12.38% in 2021. We also like Kirkland Lake's lower cost profile (AISC below $800) and the fact it has no debt. In comparison, ABX's AISCs hovers around $950-1,000/oz and has $5.1 billion in debt. This means that if the price of gold were to suddenly fall off a cliff, KL is in a better financial position to withstand a lower gold price. On the flip side, ABX has more room for improvement.
All this being said, there is a reason we added KL to our bull list. Although you can expect greater volatility, we do fell it has a strong financial position and its valuation in terms of growth still looks attractive.
Mat