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Kinross Gold (KGC) Up 9.8% Since Last Earnings Report: Can It Continue?

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A month has gone by since the last earnings report for Kinross Gold (KGC - Free Report) . Shares have added about 9.8% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Kinross Gold due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Kinross' Earnings and Sales Surpass Estimates in Q4

Kinross recorded a fourth-quarter 2023 profit from continuing operations of $65.4 million or 6 cents per share. This compares favorably with a loss of $106 million or 8 cents incurred in the year-ago quarter.

The company reported adjusted earnings of 11 cents per share, up from the prior-year quarter figure of 9 cents. The bottom line beat the Zacks Consensus Estimate of 9 cents. 

Revenues rose 3.7% year over year to $1,115.7 million in the fourth quarter. It topped the Zacks Consensus Estimate of $902.2 million.

Operational Performance

The company produced 546,513 gold equivalent ounces from continuing operations in the reported quarter, down 8.3% year over year. The figure topped our estimate of 501,971 gold equivalent ounces.

Average realized gold prices were $1,974 per ounce in the quarter, up 14% from the year-ago quarter’s figure. The figure beat our estimate of $1,844 per ounce.

The production cost of sales per gold equivalent ounce was $976, up 15.1% from the prior-year quarter’s levels. This outpaced our estimate of $913. The all-in-sustaining cost per gold equivalent ounce sold rose roughly 9.5% year over year to $1,353. This missed our estimate of $1,367.

Margin per gold equivalent ounce sold was $998 in the quarter, up from the prior-year quarter’s $883.

2023 Results

Earnings, as adjusted, for full-year 2023 were 44 cents per share compared with 22 cents a year ago. Net sales climbed 22.7% year over year to $4,239.7 million.

Financials

Cash and cash equivalents were $352.4 million at the end of the year, down around 15.7% year over year. Long-term debt was $2,232.6 million at the end of the quarter, down about 12.7%.

Outlook

For 2024, Kinross expects production to be 2.1 million gold equivalent ounces (+/- 5%). The company expects a production cost of sales of $1,020 per gold equivalent ounce (+/- 5%) for the year, factoring in inflation and production mix. The company expects an all-in-sustaining cost per gold equivalent ounce of $1,360 for 2024. Capital expenditures are predicted at $1,050 million (+/- 5%) for this year.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in estimates review.

The consensus estimate has shifted -18.75% due to these changes.

VGM Scores

At this time, Kinross Gold has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Kinross Gold has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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