Kinross Gold (KGC): The Best Gold Stock to Own Now

To appreciate why I am selecting Kingross Gold (KGC) as my stock of the week…you first need to appreciate the investment case for gold. 

Gold is yet another group that should benefit from the Fed lowering rates as it leads to a weaker US dollar. By extension that makes gold more valuable which is a big part of the shiny metal making new all time highs this year.

On top of that is the sad fact that times of global crisis are also good for gold prices. Unless you have been living under a rock, we have a few global events in the headlines including the ongoing war between Russia and Ukraine.

Perhaps more pressing are the increased tensions in the Middle East between Israel, Hamas and Hezbollah. Then last Tuesday news spread that Iran directly attacked Israel followed by expectations of Israeli retaliation. This had gold on the rise once again which likely would continue if this is an ongoing issue.   

In general, gold miners see share prices rise 2-3X more than the rise in the metal. That’s because their cost to get it out of the ground is unchanged. So nearly every dollar of increase in the selling price ends up as higher profits.

This earnings strength no doubt explains why the Gold Miners group is a highly rated industry by both Zacks Rank and the POWR Ratings. Now the task is to find the best stock in the group. For me all roads point to Kinross.

Earnings momentum is well in play with EPS expected to rise 39% year over year. Couple that with 7 straight impressive earnings beat means that growth may be even more than currently appreciated.

The 118 factor review of the POWR Ratings model says that KGC is in top 5% of stocks for likely outperformance. The most interesting part is how well they score for the Quality factors which is a sign of operational excellence. Or to put it another way, they are a well oiled machine that should do very well at translating higher gold prices into higher profits...and yes, that should nicely translate to a higher share price.

Our timing into the group looks pretty good as there has been a nice round of profit taking on gold mining shares. This has KGC pulling back from a recent high of $10.10. My goal for 2025 is for shares to rally its current perch around $9.50 up to $15, which I think is easily supported by the earnings growth expected for next year.

Now let me tell you the upside potential.

As shared many times in my recent commentary, year 3 of a bull market is often one with very tame results. So as investors get frustrated with the tepid results from most of their stock investments, they will look around for what is working.

Given the gains in gold it may be time for the next speculative flurry to take place where it becomes the most exciting thing in the investment world (that happens about every 5-10 years and is pretty much on schedule to happen around now). This is especially true if any of the aforementioned global conflicts escalates...or a new one enters the scene (like China making moves on Taiwan).

This would have gold being the best investment game in town and KGC would soar.

No...I am not banking on this outcome. The base case for Kinross is attractive enough. Just trying to lay out why there might be even more upside to this investment.

So, it’s time to dig into your wallets to mine out some KGC shares for your portfolio. 

What To Do Next?

Kingross Gold (KGC) is just one of the 14 stellar stocks found in my Zen Investor portfolio.

To learn more about our proprietary process to find more 100%+ winners…and to get your hands on the current top 14 recommendations…then all you need to do is click the link below. 

Discover the Zen Investor portfolio > 

Wishing you a world of investment success!

Steve Reitmeister…but everyone calls me Reity (pronounced “Righty”)

Editor of the Zen Investor

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