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Kirkland Lake Gold (KL) Gains But Lags Market: What You Should Know

Zacks Equity Research
Mutual Fund Report for VCVLX

Kirkland Lake Gold (KL) closed at $33.44 in the latest trading session, marking a +0.84% move from the prior day. The stock lagged the S&P 500's daily gain of 1.09%. At the same time, the Dow added 0.84%, and the tech-heavy Nasdaq gained 1.42%.

Heading into today, shares of the gold producer had lost 0.78% over the past month, lagging the Basic Materials sector's loss of 0.72% and the S&P 500's gain of 1.18% in that time.

KL will be looking to display strength as it nears its next earnings release. On that day, KL is projected to report earnings of $0.55 per share, which would represent year-over-year growth of 120%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $312.21 million, up 57.49% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2 per share and revenue of $1.25 billion. These totals would mark changes of +47.06% and +36.87%, respectively, from last year.

Any recent changes to analyst estimates for KL should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 35.53% higher. KL is currently sporting a Zacks Rank of #1 (Strong Buy).

Looking at its valuation, KL is holding a Forward P/E ratio of 16.56. Its industry sports an average Forward P/E of 34.47, so we one might conclude that KL is trading at a discount comparatively.

The Mining - Gold industry is part of the Basic Materials sector. This industry currently has a Zacks Industry Rank of 80, which puts it in the top 32% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow KL in the coming trading sessions, be sure to utilize Zacks.com.


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