Can Kinross Gold Maintain Its Strong Margin Momentum in Q3?

Kinross Gold Corporation KGC delivered a record second-quarter operating margin, thanks to a rally in gold prices, cost management and strong production performance. Its margin per gold equivalent ounce sold rose to $2,204, a 68% jump year-over-year, driven by a sharp rise in the average realized gold price. The margin growth even outstripped the 40% rise in average realized gold price to $3,284 per ounce. 

Strong margins allowed KGC to generate record free cash flow in the second quarter. It logged a robust free cash flow of $646.6 million in the quarter, surging roughly 87% year over year and 74% from the prior quarter. Free cash flow for the first half of 2025 eclipsed $1 billion. Paracatu and Tasiast mines, which accounted for more than half of KGC’s production, contributed significant cash flow in the third quarter. 

The company’s cost-control actions, coupled with continued strength in gold prices, are expected to allow it to maintain the strong margin performance in the third quarter. Kinross is focused on prioritizing margin improvement to drive cash flow, which should support shareholder returns. 

Among its peers, Agnico Eagle Mines Limited AEM also posted record operating margins in the second quarter. Agnico Eagle’s total operating margins climbed roughly 55% year over year on the back of higher realized prices. Higher margins contributed to a year-over-year increase in Agnico Eagle’s net income and operating cash flows in the second quarter. 

Newmont Corporation NEM also remains committed to maintaining its cost discipline to sustain margin expansion. Newmont achieved a notable milestone in the third quarter of 2025 by reducing its all-in sustaining costs (AISC) — the most important cost metric of miners — to $1,566 per ounce, marking a roughly 2% decrease from the prior quarter. Newmont is taking several actions to improve costs and drive productivity across its portfolio, which are expected to contribute to strong margin performance.

The Zacks Rundown for KGC

Kinross Gold’s shares have shot up 148.9% year to date against the Zacks Mining – Gold industry’s rise of 99.4%, largely driven by the gold price rally.

From a valuation standpoint, KGC is currently trading at a forward 12-month earnings multiple of 13.43, a 2.4% premium to the industry average of 13.11X. It carries a Value Score of B.

The Zacks Consensus Estimate for KGC’s 2025 and 2026 earnings implies a year-over-year rise of 117.7% and 26.9%, respectively. The EPS estimates for 2025 and 2026 have been trending higher over the past 60 days.

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

You can see the complete list of today’s Zacks #1 Rank stocks here.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

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

Zacks Investment Research