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« Agnico-Eagle Mines Makes A Breakout | Main | Newmont Scraps Hedges: About time too! »
Sunday
Jul082007

Kinross Gold Up Over 10% Since We Signalled Add to Holdings

Just one week ago, we signalled that it was a good time to add to your holdings in Kinross Gold, or acquire a position if you did not have one.

Kinross Gold Up Over 10% Since We Signalled Add to Holdings

We seemed to have made a pretty good call there, as KGC is up about 10.4% at $12.87 since we signalled a BUY at $11.66, a week ago.

There has been some speculation that Kinross may be involved with a counter bid for Meridian Gold, which Yamana Gold and Northern Orion are currently trying to take over.

We were happy when Kinross decided to take over Bema Gold, as these two gold stock were probably our two favourite junior gold producers. Yamana Gold was also one of our favourites, but the stock has fallen sharply on news of the Meridian takeover. Ironically, Yamana stock rose nearly 5% when Meridian rejected the offer.

Whether Kinross or another gold company will make an offer remains to be seen, but we do not think this story is over yet. We would prefer to see Kinross and Yamana buying smaller gold producers or explorers that are nearing production and then bringing their deposits online. Simply buying more gold production that is already priced in to the stock does not add value to the company. What we want to see is companies like Kinross and Yamana buying gold deposits that are near production (much cheaper than mines that are already producing) and bringing these projects online, therefore adding value to the company and the share price.

Meanwhile, we still like Kinross Gold and continue to have it as a BUY on our portfolio of gold stocks. If any of our readers managed to buy some Kinross stock on our signal then well done, buying on pullbacks is a vital part of making money in bull markets.

Kinross Gold trades as KGC on the New York Stock Exchange and as K on Toronto.

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