Perilous Reversal Watch: Kinross Gold Corporation (KGC)
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.Trade-Ideas LLC identified Kinross Gold Corporation (KGC) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Kinross Gold Corporation as such a stock due to the following factors:
- KGC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $49.4 million.
- KGC has traded 7.3 million shares today.
- KGC is down 3.2% today.
- KGC was up 5.5% yesterday.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in KGC with the Ticky from Trade-Ideas. See the FREE profile for KGC NOW at Trade-IdeasMore details on KGC: Kinross Gold Corporation, together with its subsidiaries, engages in mining and processing gold and silver ores. It is involved in the exploration, acquisition, development, and operation of gold bearing properties. The stock currently has a dividend yield of 3.2%. Currently there are 5 analysts that rate Kinross Gold Corporation a buy, 1 analyst rates it a sell, and 11 rate it a hold.The average volume for Kinross Gold Corporation has been 9.6 million shares per day over the past 30 days. Kinross has a market cap of $5.8 billion and is part of the basic materials sector and metals & mining industry. Shares are up 22.6% year-to-date as of the close of trading on Tuesday.STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.TheStreetRatings.com Analysis:TheStreet Quant Ratings rates Kinross Gold Corporation as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.Highlights from the ratings report include:
- KINROSS GOLD CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, KINROSS GOLD CORP reported poor results of -$2.23 versus -$1.85 in the prior year.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Metals & Mining industry. The net income has significantly decreased by 81.4% when compared to the same quarter one year ago, falling from $224.90 million to $41.90 million.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Metals & Mining industry and the overall market, KINROSS GOLD CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- Net operating cash flow has significantly decreased to $129.10 million or 57.86% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
- Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 44.42%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 80.00% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
- You can view the full Kinross Gold Corporation Ratings Report.
STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
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