IAG’s stock performance
IAMGOLD (IAG) was the best-performing gold stock of 2017, returning 51.4% for the year. It significantly outperformed the VanEck Vectors Gold Miners ETF (GDX) as well as the SPDR Gold Shares ETF (GLD). Although it hasn’t performed as well in 2018, its operating performance has been strong.
IAG’s first-quarter and second-quarter operating results were strong. In its latest quarterly results, it reported EPS of $0.03, beating the consensus estimate by $0.02. Its fundamentals have improved significantly. Based on the reserve updates and other organic growth opportunities, its future production growth seems real, which previously had been an investor concern.
Guidance for 2018
IAG is guiding for gold production of 850,000–900,000 ounces for 2018. Its AISC (all-in sustaining costs) figure is expected to be $990–$1,070 per ounce. Its exploration targets additional resources at Essakane, Saramacca, Boto, Siribaya, Nelligan, Monster Lake, and Eastern Borosi.
Of the key short-term catalysts, the preliminary reserve declaration from its Saramacca project is expected by the third quarter.
The Boto feasibility study is also expected in the third quarter. The construction decision on the project is expected next year. For more detailed potential organic growth opportunities, please read These Factors Could Drive Iamgold Stock in 2018 and Beyond. The company’s management is expected to provide an update on these projects.
Among IAG’s peers (RING)(GDXJ), Yamana Gold (AUY), Eldorado Gold (EGO), Coeur Mining (CDE), and Kinross Gold (KGC) are also trying to expand their production levels through organic growth opportunities.
Continue to the final part of this series for a close look at these gold mining companies’ valuations—and what they could mean in 2018 and beyond.