Key Morningstar Metrics for Kinross Stock
- : C$14Fair Value Estimate
- : ★Morningstar Rating
- : NoneMorningstar Economic Moat Rating
- : HighMorningstar Uncertainty Rating
Booming gold prices drove a strong first quarter for Kinross, more than offsetting reduced volume and increased unit costs. Adjusted net income of USD 850 million, or USD 0.71 per share, was 135% higher than a year ago, and the USD 0.04 per share quarterly dividend was up 33%.
Why it matters: Management reiterated its full-year guidance. The results are tracking in line with our unchanged 2026 estimates.
The bottom line: We retain our USD 10/CAD 14 fair value estimate for no-moat-rated Kinross.
- The shares appear expensive as the market projects the gold price to remain very strong at around USD 4,600 per ounce. This is well above our USD 2,050 midcycle assumption based on our estimate of the long-run marginal cost of production.
Long view: Kinross is performing very well in these boom times for gold. However, a relatively short reserve life of about a decade, steady sales of around 2 million gold equivalent ounces over our five-year forecast period, and mined grades higher than reserve grades make us cautious.
- Even converting all resources (including inferred) such as its high-grade Great Bear development to reserves would leave average reserve grades of around 0.7 grams per metric ton compared with about 1.0 mined in the first quarter.
- As a result, we expect lower margins compared with historical averages midcycle from 2030 as grades revert towards reserve levels.
Bulls say: Gold will be higher for longer, and our assumed midcycle price is too low. But even in our bull-case fair value of USD 15, we assume gold averages about USD 5,900 per ounce from 2026 to 2028 and about USD 2,450 midcycle. These assumptions are around 20% higher than in our base case.
Between the lines: We maintain our Standard Capital Allocation Rating. Given Kinross’ net cash of USD 1.4 billion at the end of the first quarter, we support the increasing cash returns to shareholders. But we prefer higher dividends over value-dilutive buybacks at the current share price.
