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Is Kinross Gold (KGC) Stock Undervalued Right Now?

Zacks Equity Research

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One stock to keep an eye on is Kinross Gold (KGC). KGC is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock holds a P/E ratio of 15.48, while its industry has an average P/E of 20.66. Over the past 52 weeks, KGC's Forward P/E has been as high as 30.49 and as low as 14.91, with a median of 23.77.

Investors should also recognize that KGC has a P/B ratio of 1.26. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 1.82. Over the past year, KGC's P/B has been as high as 1.40 and as low as 0.66, with a median of 0.89.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. KGC has a P/S ratio of 1.87. This compares to its industry's average P/S of 2.71.

Finally, our model also underscores that KGC has a P/CF ratio of 8.09. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 31.59. Over the past 52 weeks, KGC's P/CF has been as high as 9 and as low as 2.91, with a median of 5.99.

These are only a few of the key metrics included in Kinross Gold's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, KGC looks like an impressive value stock at the moment.


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