Two Canadian-based gold stocks, Centerra Gold (NYSE:CGAU) (TSE:CG) and Kinross Gold (NYSE:KGC) (TSE:K), are scheduled to release their second quarter Fiscal 2023 results on July 31 and August 2, respectively. Gold prices have gained considerable strength in 2023 thanks to the high-interest rate environment, a relatively weak U.S. dollar, massive central bank purchases, and the use of gold as a hedge against inflation. Amid the boom in gold prices, expectations from earnings results of gold companies also run high.
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Prices of gold stocks often move in tandem with the price of the yellow metal. Gold prices have risen 6.5% so far this year, while CGAU stock is up 13.5%, and KGC stock has gained a similar 13.3% year-to-date. Without further ado, let’s dive right into what the earnings expectations from these gold companies tell us.
Centerra Gold (NYSE:CGAU)
Centerra Gold engages in the operation, development, exploration, and acquisition of gold and copper properties. CGAU owns and operates the Mount Milligan copper-gold mine in British Columbia, Canada, and the Öksüt gold mine in Turkey. Notably, CGAU stock also pays a regular quarterly common dividend of $0.05 per share, implying an impressive current yield of 3.4%.
Wall Street expects Centerra Gold to report an adjusted loss of $0.14 per share, two cents more than the prior year’s adjusted loss of $0.12 per share. Meanwhile, sales estimates for Q2 are pegged at $168.65 million, almost the same as the prior year’s figure of $167.65 million. However, it would be a stark decline over Q1-2023’s sales of $226.53 million.
Centerra Gold’s financial performance has been under pressure since the suspension of production at its Öksüt gold mine in Turkey in March 2022. Additionally, the inflationary environment adds to the overall expenses of the company. The good news is that the company mentioned in its Q1 earnings that the inspection and testing at the Öksüt gold mine is completed. Management is on its way to obtaining regulatory approvals to restart production at the facility shortly.
What is the Price Target for CGAU Stock?
On TipRanks, Centerra Gold stock commands a Strong Buy consensus rating based on seven Buys and one Hold rating. The average Centerra Gold stock price target of $8.77 implies an impressive 45.7% upside potential from current levels.
Kinross Gold (NYSE:KGC)
Kinross Gold is considered one of the best gold mining companies in the world. Kinross has six active gold mines located in Brazil, Mauritania, and the U.S. The miner also produces and sells silver, adding another revenue stream for the company. KGC stock also pays a regular quarterly common dividend of $0.03 per share, implying a 2.4% yield.
Analysts expect Kinross to post an adjusted profit of $0.09 per share, nearly 200% higher than the prior year’s profit of $0.03 per share. Furthermore, Q2 sales are estimated to come in at $1.01 billion, jumping 22.9% year-over-year. Plus, the sales expectations show a modest increase over the Q1-2023 figure of $929.30 million.
Kinross Gold is consistently increasing its production and related sales of gold. Combined with an increase in average realized gold prices, the miner is able to lock in a steady jump in revenue over the quarters. As mentioned during the company’s Q1 release, Kinross is on track to meet its Fiscal 2023 production guidance of 2.1 million gold equivalent ounces (+/- 5%). This is going to be achievable by the increased production at Tasiast and La Coipa coupled with seasonal mining impacts from Paracatu and the Company’s U.S. Heap Leach operations.
Is KGC Stock a Buy, According to Analysts?
On TipRanks, Kinross Gold stock has a Moderate Buy consensus rating based on three Buys, two Holds, and one Sell rating. The average Kinross Gold price forecast of $5.73 implies 17.8% upside potential from current levels. Additionally, recent takeover interest by rival gold miner Endeavour Mining (TSE:EDV) has boosted analysts’ views of the stock.
