What happened

Shares of Canadian gold miner Kinross Gold (KGC 1.39%) are up 9% today as of 2:00 p.m. EDT after a news release yesterday and follow-up analyst upgrade today. 

So What 

Kinross released a business update and announced its first dividend payment in seven years yesterday. Its last quarterly dividend payment was in March 2013. Kinross announced "robust" three-year guidance and said the $0.03 per-share quarterly dividend will continue beyond this quarter. The new dividend represents an annual yield of about 1.2% at the current share price. 

Gold nuggets from mining.

Image source: Getty Images.

After the announcement, BMO Capital raised its rating from market perform to outperform, with a new price target of $14.25 per share.

Now what

In its operational guidance, Kinross said it expects production to "steadily increase" by 20% through 2023, driving strong free cash flow, as costs and capital expenditures decrease. The company said the production growth is the result of its previous "three-year major capital reinvestment phase." Kinross timed those investments well, as gold prices are up 28.5% since the start of the year. 

Increases in production will come from extending the planned life of mines and other mine-enhancement projects.

Investors liked the business update, particularly as the company is using conservative gold-price assumptions for its business plans. It said all of its mine plans through 2023 are based on a gold price of $1,200 per ounce, while gold currently trades at about $1,950 per ounce.