Kinross Gold Corporation
KGC
is set to release fourth-quarter 2020 results after the bell on Feb 10. Benefits of higher gold prices are expected to reflect on its fourth-quarter results. The company is also likely to have gained from strong production.
The company surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average being 20.3%. It posted an earnings surprise of 19.1% in the last reported quarter.
The stock has rallied 37.2% in the past year compared with the
industry
’s 18.8% rise.
Let’s see how things are shaping up for this announcement.
What do the Estimates Say?
The Zacks Consensus Estimate for Kinross’ fourth-quarter gold equivalent production is currently pegged at 629,000 ounces, which calls for a sequential rise of 3.5%.
Some Factors to Watch For
The company is gaining from strong performance at its three largest mines — Paracatu, Kupol-Dvoinoye and Tasiast. Notably, these mines accounted for 60% of its total gold production in the third quarter of 2020 and were also among the lowest cost mines in its portfolio. Kinross is also seeing strong production at the Fort Knox mine. Strong results across these mines are likely to have continued into the fourth quarter. Kinross, in its third-quarter call, said that it expects production to improve at Paracatu in the fourth quarter as it moves into higher grade ore.
Moreover, gold had a stellar run in 2020 as fears over the coronavirus pandemic made it the most attractive safe-haven asset. Apprehensions regarding the global economic growth fueled safe haven demand for the yellow metal through the year. A slump in crude oil prices, the ultra-low interest rate environment and geopolitical tensions also spurred up demand for gold. Moreover, concerns over supply crunch stemming from suspensions of operations by miners per government mandates to curb the virus spread also contributed to the rally in gold prices. Meanwhile, Kinross’ averaged realize price of gold also climbed 30% year over year in the third quarter. The trend is likely to have continued in the fourth quarter and supported its margins.
Kinross Gold Corporation Price and EPS Surprise
Kinross Gold Corporation price-eps-surprise
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Kinross Gold Corporation Quote
Zacks Model
Our proven model does not conclusively predict an earnings beat for Kinross this season. The combination of a positive
Earnings ESP
and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP:
Earnings ESP for Kinross is -1.51%. The Zacks Consensus Estimate for earnings for the fourth quarter is currently pegged at 22 cents. You can uncover the best stocks to buy or sell before they’re reported with our
Earnings ESP Filter
.
Zacks Rank:
Kinross currently carries a Zacks Rank #3.
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
Orion Engineered Carbons S.A.
OEC
, scheduled to release earnings on Feb 18, has an Earnings ESP of +22.33% and carries a Zacks Rank #2. You can see
the complete list of today’s Zacks #1 Rank stocks here
.
SSR Mining Inc.
SSRM
, scheduled to release earnings on Feb 17, has an Earnings ESP of +2.57% and carries a Zacks Rank #3.
Koppers Holdings Inc.
KOP
, scheduled to release earnings on Feb 24, has an Earnings ESP of +23.20% and carries a Zacks Rank #3.
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