What is BTO.TO's Intrinsic value?

B2Gold Corp (BTO.TO) Intrinsic Value Analysis

Executive Summary

As of June 6, 2025, B2Gold Corp's estimated intrinsic value ranges from $3.05 to $3.05 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Earnings Power Value $3.05 -39.0%

Is B2Gold Corp (BTO.TO) undervalued or overvalued?

With the current market price at $5.00, the stock appears to be significantly overvalued.

Understanding Intrinsic Value

Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate B2Gold Corp's intrinsic value, including:

  1. Earnings Power Value (EPV): Values the company based on its current earnings power, assuming no growth

Weighted Average Cost of Capital (WACC)

The cost of capital is a critical factor in valuation models, representing the required return for investors.

WACC Component Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.92 1.04
Cost of equity 7.9% 10.5%
Cost of debt 5.0% 5.0%
Tax rate 25.9% 26.5%
Debt/Equity ratio 0.1 0.1
After-tax WACC 7.5% 9.9%

Valuation Methods

3. Earnings Power Value (EPV)

EPV assesses a company's value based on its current normalized earnings power, assuming no growth.

EPV Component Value
Normalized Earnings $258M
Discount Rate (WACC) 9.9% - 7.5%
Enterprise Value $2,612M - $3,440M
Net Debt $95M
Equity Value $2,517M - $3,345M
Outstanding Shares 1,320M
Fair Value $2 - $3
Selected Fair Value $3.05

Key Financial Metrics

Metric Value
Market Capitalization $6600M
Enterprise Value $6731M
Trailing P/E 0.00
Forward P/E 0.00
Trailing EV/EBITDA 5.10
Current Dividend Yield 370.77%
Dividend Growth Rate (5Y) 12.49%
Debt-to-Equity Ratio 0.10

Investment Decision Framework

To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:

  1. Forecast Certainty: DCF methods rely on long-term projections, while earnings power value focuses on current normalized earnings
  2. Business Model Alignment: Dividend models are more appropriate for mature companies with established dividend policies
  3. Historical Accuracy: How well each method has predicted fair value historically

Valuation Weight Matrix

Valuation Method Weight Weighted Value
Earnings Power Value 100% $0.31
Weighted Average 100% $3.05

Investment Conclusion

Based on our comprehensive valuation analysis, B2Gold Corp's weighted average intrinsic value is $3.05, which is approximately 39.0% below the current market price of $5.00.

Key investment considerations:

  • Strong projected earnings growth (-33% to 0% margin)
  • Consistent cash flow generation
  • Conservative capital structure (Debt/Equity of 0.10)
  • Historical dividend growth of 12.49%

Given these factors, we believe B2Gold Corp is currently significantly overvalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.