A month has gone by since the last earnings report for Kinross Gold (KGC). Shares have added about 0.9% in that time frame, underperforming 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’ Q3 Earnings & Sales Outpace Estimates on Higher Prices
Kinross recorded third-quarter 2024 profit of $355.3 million or 29 cents per share compared with $109.7 million or 9 cents per share in the year-ago quarter. Adjusted earnings per share were 24 cents compared with 12 cents in the prior-year quarter. It beat the Zacks Consensus Estimate of 18 cents.
Revenues rose 29.9% year over year to $1,432 million, surpassing the Zacks Consensus Estimate of $1,186.7 million. The company benefited from higher average realized gold prices.
Operational Performance
The company produced 564,106 gold equivalent ounces in the reported quarter, down 4% year over year. The reported figure was higher than our estimate of 528,770 gold equivalent ounces. Average realized gold prices were $2,477 per ounce, up around 28.4% from the year-ago quarter’s figure. The reported figure was higher than our estimate of $2,244 per ounce.
The production cost of sales per gold equivalent ounce was $976, up around 7.1% from the prior-year quarter. The reported figure was lower than our estimate of $997. All-in-sustaining cost per gold equivalent ounce sold rose roughly 4.2% year over year to $1,350. The reported figure was lower than our estimate of $1,372.
Margin per gold equivalent ounce sold was $1,501 in the quarter, up 47% from the prior quarter’s level of $1,018.
Financial Review
Operating cash flow was $733.5 million in the third quarter of 2024 compared with $406.8 million a year ago.
Free cash flow was $414.6 million compared with $137.7 million in the prior-year quarter.
Outlook
Kinross remains on track to meet its production guidance of 2.1 million gold equivalent ounces (+/- 5%) and production cost of sales, all-in-sustaining cost and capital expenditure guidance for 2024. Kinross' annual production is projected to remain stable in 2025 and 2026, at around 2 million Au eq. oz.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month.
The consensus estimate has shifted 34.33% due to these changes.
VGM Scores
Currently, Kinross Gold has a strong Growth Score of A, a grade with the same score on the momentum front. Following the exact same course, 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 trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Kinross Gold has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Kinross Gold belongs to the Zacks Mining - Gold industry. Another stock from the same industry, Agnico Eagle Mines (AEM), has gained 2.8% over the past month. More than a month has passed since the company reported results for the quarter ended September 2024.
Agnico reported revenues of $2.16 billion in the last reported quarter, representing a year-over-year change of +31.3%. EPS of $1.14 for the same period compares with $0.44 a year ago.
For the current quarter, Agnico is expected to post earnings of $1.15 per share, indicating a change of +101.8% from the year-ago quarter. The Zacks Consensus Estimate has changed +1.1% over the last 30 days.
Agnico has a Zacks Rank #2 (Buy) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of A.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
