Is it Too Late to Buy Kinross Stock?

Kinross (TSX:K) stock has almost doubled in share price in the last year. But does that necessarily mean it’s too late to buy the stock?

| More on:

Kinross Gold (TSX:K) is a major player in the gold mining industry, with operations spanning across multiple countries. The company’s performance has been bolstered by strong production outputs and strategic investments in key mining projects.

However, shares of Kinross stock have been climbing right along with the record price of gold. Now, some may question whether it’s too late to buy it once again. So, with shares up 94% in the last year and 53% year to date, is it still a buy?

Into earnings

Kinross is set to release its second-quarter (Q2) 2024 financial results on July 31, 2024. In Q1 2024, the company reported a 13% increase in gold equivalent production, reaching 527,399 ounces. This was driven by higher throughput and improved grades at several mining sites, indicating efficient operations and robust production capabilities. The company also reported a 10% decrease in production costs, highlighting improved operational efficiency and cost-management strategies.

Kinross has consistently delivered strong financial results, with a significant rise in revenue and net income over the past year. The company’s cash flow generation remains robust, supported by stable gold prices and efficient cost control measures.

The gold stock is also focusing on cost management and expansion projects to enhance its production capabilities and ensure long-term sustainability. The company’s strategic initiatives are aimed at optimizing operations and capitalizing on high-grade ore bodies.

Looking ahead

The major question remains as to whether the company can keep it up. Kinross’s future outlook appears promising, supported by strategic investments in high-potential mining projects and ongoing exploration activities. The company is focusing on optimizing its existing operations while expanding its portfolio through acquisitions and development of new mining sites.

Key projects, such as the Tasiast expansion in Mauritania and the development of the Chulbatkan project in Russia, are expected to enhance production capacity and contribute to long-term growth.

However, the gold market’s inherent volatility, driven by economic conditions, geopolitical tensions, and fluctuations in commodity prices, poses potential risks. Investors should remain vigilant and consider these factors when evaluating the stock’s future performance.

Valuation

So, let’s look at value. Kinross is currently trading at an attractive valuation, with a price-to-earnings (P/E) ratio of 25.65, which is below the industry average. This suggests that the stock may actually be undervalued, presenting a potential buying opportunity for investors. This also makes its current dividend yield of 1.34% look all the more sweet. The company’s strong earnings growth, robust cash flow, and strategic initiatives support a positive long-term outlook.

So, considering Kinross’s strong financial performance, positive future outlook, and attractive valuation, it may not be too late for investors to buy the stock. The company’s strategic initiatives and focus on operational efficiency position it well for sustained growth. However, potential investors should stay informed on the upcoming Q2 2024 results and broader market conditions to make a well-informed decision.

While it may not be too late to invest in Kinross, prospective investors should closely monitor the Q2 results and broader market conditions. A careful assessment of these factors will help them make a well-informed investment decision.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

More on Metals and Mining Stocks

A plant grows from coins.
Metals and Mining Stocks

3 Gold and Silver ETFs for Tariff-Wary Investors

These gold and silver funds can help you diversify cheaply.

Read more »

The TFSA is a powerful savings vehicle for Canadians who are saving for retirement.
Dividend Stocks

The Best Canadian Dividend Stocks to Buy and Hold Forever in a TFSA

TFSA investors can avoid the need to fly to safety during market turns by owning the best Canadian dividend stocks.

Read more »

Safety helmets and gloves hang from a rack on a mining site.
Metals and Mining Stocks

Best Stock to Buy Right Now: Barrick Gold vs Agnico Eagle?

Agnico-Eagle Mines stock continues to soar off of strong results while Barrick Gold grapples with political troubles in its African…

Read more »

A close up color image of a small green plant sprouting out of a pile of Canadian dollar coins "loonies."
Stocks for Beginners

What to Know About 2 Canadian Mining Stocks for 2025

Mining stocks can be a strong investment, or a bit of a wild ride. So where do these two top…

Read more »

nugget gold
Metals and Mining Stocks

2 Gold Stocks to Consider in the Wake of Trump Tariffs

Investing in gold mining stocks such as Kinross can help you diversify your portfolio and lower overall risk.

Read more »

Metals and Mining Stocks

Value Hunters: It’s Time to Snap Up These TSX Gems

Investing in undervalued gems such as MAG Silver should help you beat the broader markets in 2024 and beyond.

Read more »

A plant grows from coins.
Stocks for Beginners

3 Top Basic Materials Sector Stocks for Canadian Investors in 2025

These three Canadian stocks certainly have a strong future ahead, and now might be time to buy the dip.

Read more »

todder holds a gold bar
Stocks for Beginners

Outlook for Barrick Gold Stock in 2025

Gold stock Barrick may have proven itself in the past, but with geopolitical issues on hand, should investors move elsewhere?

Read more »