Is B2Gold (TSX:BTO) Pricing Reflect Its 75% One Year Surge And DCF Implied Upside

• If you are wondering whether B2Gold at around CA$6.27 offers fair value or a potential bargain, it helps to start by lining up its price against what the underlying business may be worth.
• Over the past year, the stock has returned 74.6%, with shorter term moves of 0.5% over 7 days, a 0.3% decline over 30 days, and a 1.1% gain year to date. These shifts can change how the market views both its growth potential and risk profile.
• Recent coverage around B2Gold has focused on its position in the gold sector and how investors are reassessing producers in light of changing commodity sentiment and capital allocation priorities. This context helps explain why the share price has moved over different time frames as investors weigh gold exposure against other opportunities.
• B2Gold currently scores 3 out of 6 on our valuation checks, which suggests some areas of potential undervaluation that we will unpack using a few different methods, before finishing with a broader way to think about what the valuation really means for you.

Find out why B2Gold's 74.6% return over the last year is lagging behind its peers.

Approach 1: B2Gold Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow, or DCF, model estimates what a company might be worth by projecting its future cash flows and discounting them back to today, so you can compare that value to the current share price.

For B2Gold, the latest twelve month free cash flow is a loss of $248.47 million. Analysts and model assumptions are used to project free cash flow out to 2035, using a 2 Stage Free Cash Flow to Equity approach. For example, projected free cash flow for 2030 is $1,937 million. The years beyond 2030 are extrapolated by Simply Wall St based on smaller percentage changes in cash flows.

Discounting these projected cash flows back to today produces an estimated intrinsic value of $37.82 per share. Compared with the current share price of around CA$6.27, this DCF output suggests that the stock may be trading at a substantial discount to its estimated intrinsic value, with an implied discount of 83.4%.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests B2Gold is undervalued by 83.4%. Track this in your watchlist or portfolio, or discover 877 more undervalued stocks based on cash flows.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for B2Gold.

Approach 2: B2Gold Price vs Earnings

For profitable companies, the P/E ratio is a useful shorthand because it links what you pay directly to the earnings the business is currently generating. Investors usually accept a higher P/E when they expect stronger earnings growth or see lower risk, and a lower P/E when growth expectations are more modest or risks feel higher.

B2Gold currently trades on a P/E of 27.64x. This sits above the Metals and Mining industry average of 23.34x and slightly above the peer group average of 25.93x, which on a simple comparison might make the shares look relatively expensive.

Simply Wall St also estimates a Fair Ratio of 52.83x for B2Gold. This is its proprietary view of what a reasonable P/E could be, given factors such as earnings growth characteristics, profit margins, industry, market cap and company specific risks. This Fair Ratio can be more informative than a straight comparison with peers or the broad industry because it adjusts for these company level features rather than assuming all miners deserve similar multiples.

Comparing the current P/E of 27.64x with the Fair Ratio of 52.83x suggests B2Gold may be trading below the multiple implied by these fundamentals.

Result: UNDERVALUED

P/E ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1448 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your B2Gold Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce Narratives. This simply means you combine your view of B2Gold’s story with your own numbers for future revenue, earnings and margins, link that forecast to a fair value, and then compare it with today’s share price. You can do all this within an easy tool on Simply Wall St’s Community page that updates as new news or earnings arrive. For example, one investor might build a Narrative that supports a fair value close to CA$8.60 based on confidence in projects like Goose Mine and Fekola. Another might lean toward something nearer CA$5.36 if they focus more on risks in high-risk regions and cost pressures.

Do you think there's more to the story for B2Gold? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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