ColinSutherland

$KL, $55 target in H1/21.

Long
NYSE:KL   None
Attractive entry point for 2021.

The Company is likely to produce 1.3 - 1.4m gold oz's in 2021. The high grade nature of their deposits provides ample margin at current prices for cash accumulation / a big exploration program / sustaining capex / share buybacks / dividends.

The Group ended Sept 30th with no debt, $850m in cash, and is generating $2.25-2.50/sh in FCF annually.

The current share price is trading at April levels when gold was ~in a $1,650 - 1,750/oz despite current gold prices of $1,898/oz.

I'm expecting Group will report in excess of $1B in cash, no debt with operations contributing another record year for the Company.

Gold has rallied since Nov 30th, however KL has lagged during the $100/oz run up.

Rally of gold in 2021 will move KL to $55 levels, provided no expensive acquisitions, it should provide a 30-45% return during the year.

Cdn buyers/Cdn exchange - deval of USD coming in 2021.


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