Despite the removal of the Russian operations from our forecasts, we expect
that Kinross will continue to grow production, albeit modestly, over the next
several years. In addition, following the recently closed acquisition of Great Bear
Resources, Kinross' geopolitical risk profile has improved, particularly if the company
would no longer have exposure to Russia.
TD Investment Conclusion
We are maintaining our BUY recommendation; our target price declines to
$7.00 (from $8.50). Our target price continues to be based on heavily discounted
target multiples relative to the company's peers; we use a 1.3x NAV-5% target
multiple (weighted 60%) and a 5.5x EV/2023E EBITDA target multiple (weighted
40%). We believe that Kinross' Russian assets have already been discounted out of
the company's share price.