Kinross Gold (KGC) Stock Closes Higher as Gold Prices Rally

NEW YORK (TheStreet) -- Shares of Kinross Gold (KGC) finished the day in the green, up by 2.05% to $2.49 on Monday afternoon, as some mining and related stocks got a boost from the rebound in the price of gold.

Gold for June delivery is advancing by 1.06% to $1,186.90 per ounce on the COMEX this afternoon.

The yellow metal's price spiked today as some buyers returned to the market looking for a bargain following last week's selloff, the Wall Street Journal reports, adding that gold prices fell last week as investors lost sentiment toward the safe haven asset due to hawkish statements from the Fed.

Other stocks within the gold sector that jumped today include Alamos Gold (AGI), which closed higher by 3.04% to $7.12, B2Gold (BTG), up by 3.87%, and AuRico Gold (AUQ) which closed in the green by 1.71% to $3.56 on Monday.

Additionally, investors will be watching for U.S. economic data that is due this week, including the April non-farm payrolls report, expected to be released on Friday, Reuters reports, noting that Investors will be looking to see how the data will impact the dollar and expectations of an interest rate hike.

Separately, TheStreet Ratings team rates KINROSS GOLD CORP as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:

"We rate KINROSS GOLD CORP (KGC) a SELL. This is driven by multiple weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, weak operating cash flow and generally disappointing historical performance in the stock itself."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Metals & Mining industry. The net income has significantly decreased by 66.4% when compared to the same quarter one year ago, falling from -$742.10 million to -$1,235.10 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 40.15%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 98.46% 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.
  • Net operating cash flow has declined marginally to $176.30 million or 3.97% when compared to the same quarter last year. Despite a decrease in cash flow KINROSS GOLD CORP is still fairing well by exceeding its industry average cash flow growth rate of -40.50%.
  • 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, KINROSS GOLD CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 18.4%. Since the same quarter one year prior, revenues slightly dropped by 9.8%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • You can view the full analysis from the report here: KGC Ratings Report

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