Kinross Gold's Record FCF Sets Stage for Growth: What Comes Next?

Kinross Gold Corporation KGC logged record free cash flow of $646.6 million in the second quarter, driven by the strength in gold prices and strong operating performance. Free cash flow surged roughly 87% year over year and 74% from the prior quarter. Free cash flow for the first half of 2025 eclipsed $1 billion. 

Record operating margins, aided by cost management, healthy production and higher gold prices, led to robust free cash flow generation in the second quarter. Paracatu and Tasiast mines, which accounted for more than half of KGC’s production, contributed significant cash flow in the quarter. 

Kinross’ strong free cash flow allows it to finance its development projects, pay down debt and drive shareholder value. This strong financial base underpins key development projects, including Great Bear in Ontario and Round Mountain Phase X in Nevada. These projects are expected to boost production and cash flow, and deliver significant value. KGC’s solid financial health positions it well for disciplined capital spending and shareholder returns while supporting its key development agenda. 

Among its peers, Agnico Eagle Mines Limited’s AEM second-quarter free cash flow of $1,305 million more than doubled the prior-year quarter figure of $557 million. Agnico Eagle’s free cash flow before working capital adjustments reached $792 million, up around 36% from the year-ago quarter. Agnico Eagle’s strong financial health allows it to maintain a strong exploration budget and fund a strong pipeline of growth projects.

Newmont Corporation NEM registered a record quarterly free cash flow in the second quarter, underscoring its operational efficiency and the strength of its Tier 1 portfolio. Newmont’s free cash flow surged nearly threefold year over year and 42% from the prior quarter to $1.7 billion, led by an increase in net cash from operating activities and lower capital investment. Newmont, however, flagged several headwinds, such as higher capital spending and increased cash tax payments, which are likely to unfavorably impact third-quarter free cash flow.

The Zacks Rundown for KGC

Kinross Gold’s shares have shot up 86.2% year to date against the Zacks Mining – Gold industry’s rise of 55.6%, largely driven by the gold price rally.

From a valuation standpoint, KGC is currently trading at a forward 12-month earnings multiple of 12.43, a modest 1.4% premium to the industry average of 12.26X. It carries a Value Score of A.

The Zacks Consensus Estimate for KGC’s 2025 and 2026 earnings implies a year-over-year rise of 100% and 3.7%, respectively. The EPS estimates for 2025 and 2026 have been trending higher over the past 60 days.

KGC stock currently sports a Zacks Rank #1 (Strong Buy). 

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This article originally published on Zacks Investment Research (zacks.com).

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