Why Is Barrick Mining Stock Sinking This Week?
Key Points
Barrick's cash flows rely heavily on gold prices.
The Iran war is driving gold prices lower, not higher, triggering a sell-off in the gold stock.
Investors should wait before cashing out of Barrick.
Barrick Mining (NYSE: B) is doing really well, posting record earnings and cash flows in its last quarter. It's a gold stock, though, and sentiments can change quickly with metal prices.
This week, Barrick stock fell 13% at its lowest point through 10 a.m. ET Friday, driven by a wave of volatility and confusion sweeping through the precious metals markets.
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Why is gold reversing amid a war?
The markets typically become chaotic and volatile during economic and geopolitical crises. The ongoing war in the Middle East has triggered a massive sell-off in equities. During turbulent times like these, investors flock to "safe-haven" assets like gold and silver.
That's not what's happening right now, though.
Gold is on track for its first weekly decline in nearly five weeks, according to TradingEconomics.com. Gold is trading below $5,100 an ounce as of this writing, after briefly topping $5,400 per ounce earlier this week.
That has left investors confused. Why is gold falling during a war?
One reason is that the U.S. dollar has strengthened, making gold more expensive for global buyers and hurting demand. Global investors are moving into cash and the U.S. dollar instead, capping any rally one might have expected in gold.
Shares of Barrick are falling alongside gold as its earnings and cash flows are directly correlated to the price of the yellow metal.
Should you buy the dip in Barrick?
With Barrick projecting lower gold production for 2026, ranging between 2.9 million to 3.25 million ounces compared with 3.26 million ounces it produced in 2025, falling gold prices have amplified concerns over the gold stock's near-term earnings growth.
Barrick, however, is arguably in its strongest financial position in many years and is also planning to spin off its premier North American gold assets into a separate company by the end of this year to unlock greater value for its shareholders. Any dip in the stock, therefore, is an opportunity to buy for the long term, although it could be a volatile ride.
Neha Chamaria has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.