Markets

Analyst Actions: Credit Suisse Initiates "Outperform" Rating on IAMGold; TP at US$25

IMG takes three-pronged strategy for company transformation. "CEO Stephen Letwin has spearheaded the company's strategy toward transformation since taking the helm a year ago. That strategy has been focused on three areas: (a) shedding non-core assets; (b) expanding cornerstone assets; and, (c) hunting for a suitable gold target to replace divested production with higher quality ounces. Normally, pending M&A would be a signal for investors to shy away. In this case IAG has a $1.1B cash balance (and growing) which should be put to use. If successful, this three-pronged strategy will makeover IAG into a growth-oriented gold producer with a portfolio of high quality long life assets."

It's still a long way to go for IMG. "Catalysts to further share price would include: (a) firming up growth with an accretive gold acquisition; (b) announcing a strategic partner in Niobec or doing an IPO of a portion of the asset; (c) successfully executing on start-ups at Westwood (Q2/13) and expansions at Rosebel (Q3/12), Essakane (Q3/13) and Sadiola (Q1/14); (d) selling down the remaining stake in high cost Mupane."

Initiating Coverage: "We are initiating coverage of IAMGOLD Corp. (IAG.N, IMG.TO) with an Outperform rating and a USD25.00 Target price. Our target price is based on a target P/NAV multiple of 1.2 times our NAV of USD20.79/sh. We derive our USD25.00 Target price based on a target P/NAV multiple of 1.2 times our NAV of USD20.79/sh. Target P/NAV multiples have historically ranged from 1.0 to 2.0 times for gold producers in the Canadian coverage universe."

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2016 MTNewswires.com. All rights reserved. Unauthorized reproduction is strictly prohibited.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Other Topics

Commodities

Latest Markets Videos

    MTNewswires

    Founded in 1999, MT Newswires (formerly known as Midnight Trader) is a leading provider of original source, multi-asset class, real-time, global financial news and information to most of the largest banks, brokerage firms and professional market data, trading & research applications in North America.

    Learn More