Market Overview

BMO Says Kinross Gold Is 'Beaten Down,' Upgrades To Outperform

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  • Kinross Gold Corporation (USA) (NYSE: KGC) shares have gained 35 percent since January 11.
  • BMO Capital Markets’ Andrew Kaip upgraded the rating for the company from Market Perform to Outperform, while raising the price target from $2.00 to $2.75.
  • Potential upside in Nevada could be a positive catalyst for the stock, Kaip stated.

Over the last couple of days, Kinross Gold’s shares have gained 25 percent. Despite this, the shares trade “at a meaningful discount” to the peer group, analyst Andrew Kaip said. He added that Kinross Gold is an operator with a strong track record of execution, and “represents a relatively lower-risk company, with potential upside in Nevada as a positive catalyst on the horizon.”

Kaip expects there to be a re-rating of Kinross Gold’s shares towards its historical P/CF and P/NAV averages. He mentioned that has met or beaten its initial production guidance every year since 2010, and could likely meet guidance again when it reports results on February 10.

Kinross Gold has a long track record of execution, the analyst commented, while adding that the company appears well positioned as “a relatively lower-risk company among the peer group.”

“Kinross is currently undergoing a scoping study for an expansion scenario at Round Mountain, after acquiring the asset along with Bald Mountain from ABX late last year. In our view, the expansion is now likely to appear more attractive to investors at the current gold price of ~$1,170/oz (vs. $1,085/oz at the time of the acquisition), and delivery of the study represents a potentially positive catalyst,” Kaip wrote.

Latest Ratings for KGC

DateFirmActionFromTo
Oct 2019DowngradesOverweightEqual-Weight
Sep 2019MaintainsNeutral
May 2019DowngradesNeutralUnderweight

View More Analyst Ratings for KGC
View the Latest Analyst Ratings

Posted-In: Andrew Kaip BMO Capital MarketsAnalyst Color Long Ideas Upgrades Price Target Analyst Ratings Trading Ideas

 

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