Today's Dead Cat Bounce Stock Is Kinross Gold (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 ( KGC) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Kinross Gold 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 $48.7 million.
  • KGC has traded 324,398 shares today.
  • KGC is up 3.6% today.
  • KGC was down 8.2% yesterday.

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More details on KGC:

Kinross Gold Corporation, together with its subsidiaries, is engaged in mining and processing gold and silver ores. It is involved in the exploration, acquisition, development, and operation of gold bearing properties. Currently there are 7 analysts that rate Kinross Gold a buy, 1 analyst rates it a sell, and 10 rate it a hold.

The average volume for Kinross Gold has been 14.3 million shares per day over the past 30 days. Kinross has a market cap of $3.5 billion and is part of the basic materials sector and metals & mining industry. Shares are down 30.4% year-to-date as of the close of trading on Wednesday.

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 as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Highlights from the ratings report include:
  • 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 112.2% when compared to the same quarter one year ago, falling from $41.90 million to -$5.10 million.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 34.27%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 100.00% 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.
  • 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. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, KINROSS GOLD CORP reported poor results of -$2.64 versus -$2.23 in the prior year. This year, the market expects an improvement in earnings ($0.14 versus -$2.64).
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Metals & Mining industry and the overall market on the basis of return on equity, KINROSS GOLD CORP has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • 43.61% is the gross profit margin for KINROSS GOLD CORP which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -0.53% is in-line with the industry average.

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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