Kinross Gold (KGC) Stock Is Down as Gold Trades in the Red

NEW YORK (TheStreet) -- Shares of Kinross Gold Corp  (KGC) are down 3.31% to $2.48 in late afternoon trading Tuesday, along with other gold related stocks as the precious metal trades in negative territory.

Gold prices are under pressure amid a strengthening U.S. dollar. The dollar gained on steady U.S. 10-year bond yields, weighing on sentiment towards gold, Reuters reports.

U.S. gold futures settled lower by 1.7% to $1,206.70 an ounce.

Spot gold was last trading at $1,208.30 an ounce as of 3:29 p.m. ET today.

Canada-based Kinross is engaged in gold mining and related activities, including exploration and acquisition of gold-bearing properties, the extraction and processing of gold-containing ore, and reclamation of gold mining properties.

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 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 when compared to that of the S&P 500 and the Metals & Mining industry. The net income has significantly decreased by 122.6% when compared to the same quarter one year ago, falling from $29.60 million to -$6.70 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 36.82%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 133.33% 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.
  • 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.
  • 39.74% is the gross profit margin for KINROSS GOLD CORP which we consider to be strong. Regardless of KGC's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, KGC's net profit margin of -0.85% significantly underperformed when compared to the industry average.
  • Despite the weak revenue results, KGC has outperformed against the industry average of 17.6%. Since the same quarter one year prior, revenues slightly dropped by 4.4%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • You can view the full analysis from the report here: KGC Ratings Report

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