# Kirkland Lake Gold (KL)



## JosephK (Nov 7, 2012)

They are an Ontario based gold miner. Came to my attention when they announced this deal to buy St. Andrews Goldfields which I have shares in. 

http://web.tmxmoney.com/article.php?newsid=80666270&qm_symbol=SAS

Normally I would just sell before it goes through to avoid complications, but in this case the buying company is attractive enough and similar enough to the original that I've decided to hold on and even pick up a few more shares.

I like that the resulting company will have all its operations in Canada, has a lower than average cost base and (most importantly) is actually turning a profit. 

Anyone else have an opinion on these guys?


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## james4beach (Nov 15, 2012)

This stock has done amazingly well in the last 3 years. I'm not familiar with the company but it caught my attention recently. The 3 year performance is about +100% per year.

I'm actually not sure how I missed such a heavily traded stock. Appears to trade around 1 million shares daily in Canada with nearly $6 billion market cap. Dual listed. Not a penny stock or micro cap by any means.

Does anyone hold it?


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## stardancer (Apr 26, 2009)

I don't hold this, but living in KL for the last 70+ years, I am familiar with it. This mine has had its ups and downs, and its share of owners. The current management is doing really well in this volatile field. The mine is fairly well run, and of course, the town is extremely dependent on its well being.


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## yyz (Aug 11, 2013)

I hold about 700 shares .Been a great ride with this one.
I originally bought Crocodile Gold which merged with Newmarket Gold which ultimately merged with Kirkland Lake Gold.


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## leoc2 (Dec 28, 2010)

Born and raised in KL. Grand father worked in the mines. My father ran a service station and sold a recreational vehicle called a ski doo in the early 1960's. My father did well and took care of us selling and servicing these machines. Right place at the right time. Great memories. Unfortunately I never pulled the trigger on this one.


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## JosephK (Nov 7, 2012)

Still holding on to it though I did sell some shares recently as it was starting to make up a bigger % of my portfolio compared to other stocks than I would like it to.


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## james4beach (Nov 15, 2012)

This stock is just insane. I'm long, and up 50% but I don't see how anyone can buy it when it's hitting all time highs virtually every day.


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## peterk (May 16, 2010)

Well you did apparently, when it was hitting all time highs just last year!

Good pick James!


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## james4beach (Nov 15, 2012)

peterk said:


> Well you did apparently, when it was hitting all time highs just last year!
> 
> Good pick James!


Thanks. Well, this could be awfully volatile so I am bracing myself for what could happen when it hits the (inevitable) correction.


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## james4beach (Nov 15, 2012)

I sold 1/4 of my position at $52.77 (all time high) to scale back the position size. It was becoming outlandishly large versus my other individual stocks.

http://schrts.co/kpIisrUh


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## james4beach (Nov 15, 2012)

KL announced a $4.9 billion deal (in shares) to buy Detour Gold

https://www.ctvnews.ca/business/kir...etour-gold-in-stock-deal-worth-4-9b-1.4700843

KL is down 16% on the news. Surprisingly though, DGC is only up 3%.


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## MrMatt (Dec 21, 2011)

I'm voting NO. DGC is steadily improving and quite undervalued.


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## james4beach (Nov 15, 2012)

Well now I'm happy that I lightened up my position at 52.77. The stock has been weaker lately so perhaps the rally is over?

It's now the smallest position in my low dividend portfolio, which is fine. Was always extremely high risk and highly volatile in any case.

There are also technical signs of weakness in the stock, like falling below its 200 day moving average which is almost always a bad sign, at least for medium term.


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## MrMatt (Dec 21, 2011)

Just got an unsolicited tender for less than the market price.
I guess TRC Capital Investments makes a habit of this kind of garbage.


trc capital investment corporation canada


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## Ponderling (Mar 1, 2013)

I just saw they were being dumped on in late July, so bought. Gold ran up, 9K position in a TFSA account became 10K 5 weeks later, and KL was sold. I will be watching this one for getting in again.


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## MrBlackhill (Jun 10, 2020)

Not sure I understand why this stock traded flat in 2020.

Earnings and sales are still growing at an incredible speed, even through the pandemic.

Multiples are decent, much lower than most stocks. Other fundamentals are very strong. Financials are insanely solid.


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## MrMatt (Dec 21, 2011)

MrBlackhill said:


> Not sure I understand why this stock traded flat in 2020.
> 
> Earnings and sales are still growing at an incredible speed, even through the pandemic.
> 
> Multiples are decent, much lower than most stocks. Other fundamentals are very strong. Financials are insanely solid.


Might be due to the big kick at the end of 2019 when they aquired Detour.
Detour was a very different type of mine, with a different operating profile.
I think i

Personally I think KL got a hell of a steal and Detour shareholders got ripped off.
At lease I got KL stock, which worked out well.


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## MrBlackhill (Jun 10, 2020)

MrMatt said:


> Might be due to the big kick at the end of 2019 when they aquired Detour.
> Detour was a very different type of mine, with a different operating profile.
> I think i
> 
> ...


True, I forgot that the Detour deal has divided the opinions. Hopefully, it will soon be in the past and investors will see it was a good deal.


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## MrMatt (Dec 21, 2011)

MrBlackhill said:


> True, I forgot that the Detour deal has divided the opinions. Hopefully, it will soon be in the past and investors will see it was a good deal.


No, it wasn't, it was a rip off.
They dramatically underpaid for Detour, as more and more good news about the Detour properties comes out, it just gets worse.








Kirkland Lake Gold Reports Wide, High-Grade Intersections in Saddle Zone at Detour Lake Mine, Drilling Extends Mineralization 200 Metres to West


Additional intersections with exceptional grades reported in eastern portion of Saddle Zone(1) Key intercepts: 4.02 grams per tonne (“gpt”) over 43.0...




www.globenewswire.com





I'm not saying that KL wasn't a good company. They are an excellent company, and even today they're a great investment IMO.

Detour was just dramatically underpriced for the acquisition, and they significantly diluted my stake in the Detour properties by almost 4x.
As the rest of the world realizes exactly how good the Detour assets are, it becomes even more obvious how much of a steal KL got.


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## MrBlackhill (Jun 10, 2020)

MrMatt said:


> As the rest of the world realizes exactly how good the Detour assets are, it becomes even more obvious how much of a steal KL got.


Well then that means for KL investors it was good deal to acquire Detour, not? Wasn't that what I said?

Maybe I'm misunderstanding something here.


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## MrMatt (Dec 21, 2011)

MrBlackhill said:


> Well then that means for KL investors it was good deal to acquire Detour, not? Wasn't that what I said?
> 
> Maybe I'm misunderstanding something here.


You said "Hopefully, it will soon be in the past and investors will see it was a good deal. ", I guess from the perspective of the KL shareholders it can be seen as a good deal.
For Detour holders it wasn't.

For Detour they've seen their excellent investment diluted to only very good.
For KL (who haven't realized it) they've seen their excellent performing mines drop to much lower overall efficiencies, so it also looks bad to them.

The reality is that you mixed a high and low AISC operations together, so both sides will be disappointed.


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## MrBlackhill (Jun 10, 2020)

MrMatt said:


> You said "Hopefully, it will soon be in the past and investors will see it was a good deal. ", I guess from the perspective of the KL shareholders it can be seen as a good deal.
> For Detour holders it wasn't.


Ah ok, language barrier on my side. I should've written "Hopefully, it will soon be in the past and investors will see it was a good deal for KL investors". But then you have good points about the disappointment on both sides. I was just analysing KL growing balance sheet and missing other concerns.



MrMatt said:


> For Detour they've seen their excellent investment diluted to only very good.
> For KL (who haven't realized it) they've seen their excellent performing mines drop to much lower overall efficiencies, so it also looks bad to them.
> 
> The reality is that you mixed a high and low AISC operations together, so both sides will be disappointed.


Good points, thanks.


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## Ricehammer4416 (Jan 6, 2021)

I'm trying to get a feel for this one, I've been watching it for a few months. As pervious posters have said, the fundamentals seem to be solid, yet this stock keeps dropping. Trading at a decent PE, has a decent yield, turning a decent profit, bundles of cash on hand. 

Is there something I'm missing?


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## MrBlackhill (Jun 10, 2020)

I personally think this downtrend will reverse itself pretty soon at some point during this year, maybe during this summer.

It is now a >2% dividend stock with rock-solid fundamentals and I believe it has much more upside potential than downside. And gold is higher than previously.


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## MrMatt (Dec 21, 2011)

The Detour fields have a LOT of gold, it's just a bit expensive to get to.
If you believe gold is going to go up, it really should rocket up. 
Also Kirkland management seems very good at driving efficiency, which is another benefit.

I'm quite positive on the prospects here.


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## Ricehammer4416 (Jan 6, 2021)

I got in on this one at the most recent bottom, 40.30 average. I had been watching it for quite a long time. It was easy to see the value there. Healthy balance sheet, $$$ in the bank, good mgmt and over sold. My problem now after the most recent run is when to exit. I'm up over 30% .. usually when I buy a stock that's not a long term hold, I have an exit point in mind. That's not the case here..

I'm definitely going to ride out this run for a while longer but I'm wondering if anyone else might be in the same position and what they might have in mind for an exit.


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## londoncalling (Sep 17, 2011)

I believe you mentioned on the WEF thread that you use stop losses. I am guessing this is the debate you are having as to where to set that stop loss. Deciding when to sell is often difficult. A few options ,

1) setting partial sale stops
2) setting a full sale stop and planned re entry price

I have not had good luck with stop loss orders as I find market makers can manipulate orders to trigger sales and then drive the price up. Having the conviction to set an exit price and sticking to it is not an easy thing to do. I say pick a number and live with it. Do I wish I sold some WEF last week? Absolutely but only based on hindisight bias.


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## Ricehammer4416 (Jan 6, 2021)

I haven't used stop losses much, but WEF was getting to the point where I didn't want to lose money. Less of a concern with KL at least at for now. 

Yeah setting an exit point has always been the hardest part for me on stocks like this. Which is why I prefer buy and holds but the opportunity with KL was just too great. I've decided I'll sell when my gains drop below 23 percent. That's a 10 percent drop from the current price and not a bad exit point. I'll keep sliding that up accordingly. 

Thanks for letting me talk that out. Haha. Wish I would have used the same strategy on WEF .


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## londoncalling (Sep 17, 2011)

Ricehammer4416 said:


> I haven't used stop losses much, but WEF was getting to the point where I didn't want to lose money. Less of a concern with KL at least at for now.
> 
> Yeah setting an exit point has always been the hardest part for me on stocks like this. Which is why I prefer buy and holds but the opportunity with KL was just too great. I've decided I'll sell when my gains drop below 23 percent. That's a 10 percent drop from the current price and not a bad exit point. I'll keep sliding that up accordingly.
> 
> Thanks for letting me talk that out. Haha. Wish I would have used the same strategy on WEF .


As you know I didn't have the best exit strategy with my sale of WEF. It's always easy to provide suggestions to others. I agree with your plan to exit KL with a decent profit and buffer to ensure a gain is secured. As you stated, sometimes all it takes is to make a post to help ourselves come to our own conclusion. 

Cheers


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## MrBlackhill (Jun 10, 2020)

KL getting acquired by AEM.


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## Covariance (Oct 20, 2020)

RIP. It was a fun ride from 2015 to 2019


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## MrMatt (Dec 21, 2011)

MrBlackhill said:


> KL getting acquired by AEM.


I haven't looked into it yet.
Is the AEM takeover going to screw KL as bad as the KL takeover of DGC?

It's possible that even after the takeover AEM might be worth holding, KL was still worth holding, mostly because they got to underpay for DGC.

Yes I'm bitter, KL underpaid thousands for my share.


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## MrBlackhill (Jun 10, 2020)

MrMatt said:


> Yes I'm bitter, KL underpaid thousands for my share.


It's understandable. AEM will likely underpay my KL shares.

So for anyone who started this journey with DGC, then got underpaid by KL, then got underpaid by AEM, it's a though run.


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