Gold exploration and production giant Barrick Gold Corp (GOLD) is up 6% over the past year, underperforming both the stock market and a massive rally in gold itself. One trader sees shares trending higher over the next two years.
That’s based on the January 15 2027 $35 calls. With 785 days until expiration, 20,024 contracts traded compared to a prior open interest of 104, for a massive 193-fold jump in volume on the trade. The buyer of the calls paid $0.64 to make the bullish bet.
Barrick shares recently traded for just under $18, so they would need to rise by $17, or rally 94%, for the option to move in-the-money. Barrick would need to break past its 52-week high of $21.35 to move in-the-money.
Given Barrick’s underperformance relative to gold, such a move higher by early 2027 is possible. Thanks to rising gold prices and solid production, Barrick has grown revenues 17% in the past year, and earnings are up over 30%, far higher than the appreciation in share price.
Action to take: Given gold’s uptrend and likely continued uptrend, gold mining stocks should join in the rally at some point. Long-term investors may like Barrick shares here, and can also earn a 2.3% dividend along the way.
For traders, the January 2027 $35 calls have plenty of time to play out, and have enough time left on the trade to easily see triple-digit gains if gold prices continue to rise and gold stocks stage a catch-up rally.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.