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Kinross Gold Corp to Divest Portion of Lundin Gold Shares


Trades from $3

As part of its portfolio management strategy, Kinross Gold Corporation (KGC - Analyst Report) announced that it has inked a deal with GMP Securities L.P., whereby GMP has agreed to buy for re-sale, on a private placement basis, 5,500,000 common shares of Lundin Gold Inc., which represents about 4.6% of currently outstanding common shares.

GMP is purchasing shares at a price per share of CAD$5.60, resulting in gross proceeds of CAD$30,800,000.

Kinross holds about 22.1% of the issued and outstanding shares before closing the sale. After the completion of the sale, the company will own 20,656,250 shares, representing approximately 17.4% of the issued and outstanding shares.

Closing of the sale is subject to customary closing conditions and is expected to take place on or around Oct 5, 2016.





Kinross reported a net loss of $25 million or 2 cents per share for second-quarter 2016, narrower than a net loss of $83.2 million or 7 cents per share in the year-ago quarter. Adjusted loss came in at $9.8 million or a penny per share. The Zacks Consensus Estimate was earnings of a penny. Revenues of $876.4 million in the quarter surged 16% year over year and surpassed the Zacks Consensus Estimate.

Kinross’ cash and cash equivalents were $968.2 million as of Jun 30, 2016, down 6.1% year on year. Long-term debt declined around 12.8% year over year to $1,733.1 million. For 2016, the company reaffirmed its previously stated production guidance. It anticipates producing about 2.7–2.9 million gold equivalent ounces this year.

Kinross currently has a Zacks Rank #3 (Hold).

Stocks to Consider

Some better-ranked companies in the mining space include AngloGold Ashanti Ltd. (AU - Snapshot Report) , New Gold Inc. (NGD - Snapshot Report) and Newmont Mining Company (NEM - Analyst Report) .

AngloGold Ashanti has an expected earnings growth rate of 440% for the current year. The company sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

New Gold also sports a Zacks Rank #1 and has an expected earnings growth rate of 491.7% for the current year.

Newmont flaunts a Zacks Rank #1 and has an expected earnings growth rate of 91.3% for the current year.

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