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Kirkland Lake Gold (KL) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research

Kirkland Lake Gold (KL) closed at $45.98 in the latest trading session, marking a -0.5% move from the prior day. This move lagged the S&P 500's daily gain of 0.03%. Meanwhile, the Dow gained 0.13%, and the Nasdaq, a tech-heavy index, lost 0.11%.

Coming into today, shares of the gold producer had gained 1.56% in the past month. In that same time, the Basic Materials sector gained 6.86%, while the S&P 500 gained 4.17%.

KL will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $0.79, up 182.14% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $389.52 million, up 74.91% from the prior-year quarter.

KL's full-year Zacks Consensus Estimates are calling for earnings of $2.38 per share and revenue of $1.33 billion. These results would represent year-over-year changes of +75% and +44.78%, respectively.

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It is also important to note the recent changes to analyst estimates for KL. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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. The Zacks Consensus EPS estimate has moved 7.2% higher within the past month. KL is currently sporting a Zacks Rank of #1 (Strong Buy).

Investors should also note KL's current valuation metrics, including its Forward P/E ratio of 19.4. This valuation marks a discount compared to its industry's average Forward P/E of 31.38.

The Mining - Gold industry is part of the Basic Materials sector. This industry currently has a Zacks Industry Rank of 8, which puts it in the top 4% 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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Zacks Investment Research