We recently compiled a list of the 7 Best Cheap Stocks To Buy Today Under $10. In this article, we are going to take a look at where Kinross Gold (NYSE:KGC) stands against the other cheap stocks to buy under $10.
On September 30, Federal Reserve Chair Jerome Powell addressed the National Association for Business Economics (NABE) Annual Meeting in Nashville, TN, and expressed his views on the economy, highlighting both positive and negative trends. On the positive side, he noted that the economy has shown resilience and is still growing at a solid pace, with the labor market remaining strong. He also mentioned that the recent upward revisions to GDP and GDI have removed a downside risk to the economy and that the savings rate has increased, indicating that consumers have more savings on their balance sheets.
However, Powell also pointed out that the labor market has cooled, with the unemployment rate rising to 4.2% and the job finding rate decreasing. He noted that this cooling is not necessarily a bad thing, as it may be a sign of a more sustainable labor market. Additionally, he mentioned that the housing market is still a concern, with housing inflation running at around a 3% annualized pace, which is contributing to overall inflation.
In terms of monetary policy, Powell indicated that the Fed is committed to using its tools to achieve its inflation target of 2%. He noted that the Fed has made progress in reducing inflation but still has work to do. He also stated that the Fed will be monitoring the data closely and will adjust its policy stance as needed to maintain the strength of the economy.
Jamie Dimon: Fed Rate Cut Was Necessary
In an interview with CNBC on 29 September, Jamie Dimon, CEO of JPMorgan Chase, discussed the recent interest rate cut by the Federal Reserve, saying that it was a necessary move to adjust to slowing economic growth and decreasing inflation. He notes that the economy is still strong but that there are underlying concerns about inflation and geopolitics that could impact the market. In terms of geopolitics, Dimon expresses concern about the ongoing war in Ukraine and notes that it is likely to get worse. He believes that the US and its allies need to be prepared for a longer war and that more military help will be needed to support Ukraine. Dimon also touches on the topic of the US presidential election, saying that he is not endorsing any candidate at this time and is instead focusing on policy issues that can help both the world and the US.
With the Fed’s ongoing efforts to balance growth and inflation, the economy appears poised to continue its steady expansion; with that in context, let’s take a look at the 7 best cheap stocks to buy today under $10.
Our Methodology
To compile our list of the 7 best cheap stocks to buy today under $10, we used the Finviz and Yahoo stock screeners to find the largest companies with stock prices under $10. From that list, we selected companies that are trading at a forward P/E ratio of under 15, as of October 1. We then narrowed our choices to 7 stocks that were the most widely held by hedge funds. The list is sorted in ascending order of their hedge fund sentiment, as of the second quarter, which we sourced from our database.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Aerial shot of a mine entrance, the bedrock of the company’s gold and silver extraction.
Kinross Gold (NYSE:KGC)
Number of Hedge Fund Investors: 37
Forward P/E Ratio as of October 1: 15.41
Kinross Gold (NYSE:KGC) is a Canadian-based gold mining company with operations in the Americas, West Africa, and Russia. The company prioritizes high-quality and low-cost gold development projects. Kinross Gold (NYSE:KGC) has a promising pipeline of gold projects that includes the Great Bear project in Ontario, the Manh Choh project in Alaska, and the Lobo-Marte project in Chile, driving its future growth and expansion.
In Q2, Kinross Gold (NYSE:KGC) reported a 4% decrease in gold production to 535,300 ounces, primarily due to declines at Tasiast, Paracatu, and La Coipa. However, the company’s US operations, including Fort Knox and Round Mountain, showed a production increase. Despite the overall production decline, Kinross Gold’s (NYSE:KGC) revenue rose 10% year-over-year to $1.43 billion, driven by higher gold prices. While all-in-sustaining costs (AISC) increased 7% to $1,387 per ounce, the higher gold price offset the cost increase, resulting in a 40% increase in AISC margins to $955 per ounce.
Kinross Gold’s (NYSE:KGC) focus on low-cost and high-quality gold production has enabled it to generate consistent cash flow. With a realized gold price of $2,342 an ounce, the company’s annual operating cash flow potential is over $2 billion. Furthermore, with gold prices trading above $2,500 an ounce, the company’s annual free cash flow visibility is over $1.5 billion to $2 billion. This robust free cash flow generation will enable Kinross Gold (NYSE:KGC) to invest in growth initiatives and potentially increase its dividend payout.
As of the second quarter, the company’s stock is held by 37 hedge funds, with a total stake valued at $629.88 million.
Overall KGC ranks 2nd on our list of the best cheap stocks to buy under $10. While we acknowledge the potential of KGC as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than KGC but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.