Given that the geo-political risk in Ecuador is similar to that of Venezuela the first respected analyst Stephen Walker, from RBC Capital Markets positive comments and retains an outperform rating on Kinross, removed investors fear of rating cuts for Kinross more important I think it also shows that buyout of risky companies like KRY from geographically diversified mid size or majors gold companies won't affect their rating, outlook or share price very much, I think most companies would love to have Las Cristinas reserve but fear answering to shareholders if their pps tanks after making a move on KRY, Kinross may have paved the way

Associated Press
Kinross surges as analyst upbeat on '09 production
Associated Press 08.21.08, 1:00 PM ET

PITTSBURGH -

Shares of Kinross Gold Corp. climbed Thursday after an analyst raised future production estimates based on anticipated growth at Kinross mines in the United States, Russia and Brazil.

Its stock gained $1.42, or 9 percent, to $17.16 in afternoon trading. The stock has traded between $10.94 and $27.40 over the past year, and is off 14.5 percent year-to-date.

Stephen D. Walker, an analyst with RBC Capital Markets, reduced his 2008 gold equivalent production forecast for Kinross because of mine expansion delays, lower production at one mine and the planned sale of another mine.

But he wrote in a note to investors that production was due to increase in 2009 and grow further by 2011, largely because of ramp-ups at Kinross' Paracatu mine in Brazil, its Kupol mine in Russia and its Kettle River/Buckhorn mine in Washington state.

Cash costs for Toronto-based Kinross are expected to increase for 2008, in line with the company's increased guidance, but are due to fall next year as the company enters a full year of production at the low-cost Kupol mine, he wrote.

Kinross is also expected to complete a planned acquisition of Canada-based Aurelian Resources Inc., according to Walker.

Last month, Kinross said it will buy Aurelian for more than $1 billion in a move designed to boost its mining reserves. That would give Kinross control over Aurelian's gold, silver and base metals reserves in Ecuador's Cordillera del Condor region.

Walker, who holds an "Outperform" rating on the stock, cut the Kinross' price target to $23 from $27, but said "we maintain our positive investment case for Kinross."

That price target implies upside of 46.1 percent over its closing price Wednesday of $15.74.

Earlier this month, Kinross reported sharply lower second-quarter earnings because of weaker production and higher costs. Its profit dropped by half to $26 million, or 4 cents per share, from $53 million, or 9 cents per share, during the same period last year.

Excluding one-time items, the company said its adjusted profit rose 17 percent to $55.8 million, or 9 cents per share, from $47.6 million, or 4 cents per share, last year.

Its results met analysts' average forecast of an adjusted profit of 9 cents per share, according to a poll by Thomson Reuters.

Quarterly revenue edged up 3 percent to $298.7 million from $290.1 million last year.

Kinross also slightly lowered its 2008 production forecast to about 1.8 to 1.9 million gold equivalent ounces. It expects to produce about 2.4 to 2.5 million gold equivalent ounces in 2009, the company said.

Analysts predict Kinross will earn $1.07 per share on revenue of $2.35 billion for 2009.

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