Kinross (KGC) To Report Q3 Earnings: Is A Beat In Store?

Kinross Gold Corporation (NYSE:KGC) is set to release third-quarter 2019 results on Nov 6, after closing bell. The company’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, the average being 66.7%.

The stock has surged 76.7% in the past year compared with the industry’s 56.6% rally.

What the Zacks Model Says

Our proven model predicts an earnings beat for Kinross this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earning beat.

Earnings ESP: Earnings ESP for Kinross is +2.50%. The Zacks Consensus Estimate is currently pegged at 8 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Kinross currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Factors at Play in Q3

The company’s third-quarter performance is likely to have benefitted from higher production at Paracatu, Kupol and Tasiast. These are the company’s three largest operations, representing more than 60% of its production during the first half of 2019. Moreover, they delivered the lowest costs in Kinross’ portfolio. The trend is expected to have continued in the third quarter.

Notably, Paracatu continues to perform impressively. So far this year, Paracatu has witnessed higher production and also maintained its lower costs. While recoveries and throughput might have remained strong in the third quarter, mining is expected to have transitioned to lower grade portions of the pit.

Tasiast is also making notable progress in becoming a large low-cost producer. The mine’s throughput continues to average above the company’s expectations as costs continue to decline.

Moreover, higher gold pricing environment is an additional upside for the company. Benefits of higher gold prices are expected to get reflected in Kinross’ third-quarter margins. Gold has had a strong run in 2019. Uncertainties related to the U.S.-China trade standoff and geopolitical tensions have triggered demand for gold so far this year. Higher prices are likely to have had a positive impact on the company’s third-quarter earnings.

Stocks Poised to Beat Estimates

Here are some other companies in the basic materials space you may want to consider as our model shows that they also have the right combination of elements to post an earnings beat this quarter:

Franco-Nevada Corporation (TSX:FNV) has an Earnings ESP of +0.34% and sports a Zacks Rank #1.

Pan American Silver Corp. (NASDAQ:PAAS) has an Earnings ESP of +5.42% and carries a Zacks Rank #3.

Arconic Inc (NYSE:ARNC) has an Earnings ESP of +1.42% and carries a Zacks Rank #3.

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