Lawson Winder, an analyst from Bank of America Securities, maintained the Buy rating on IAMGOLD (IAG – Research Report). The associated price target is $3.00.
Lawson Winder has given his Buy rating due to a combination of factors that signal an improvement in IAMGOLD’s economic prospects. The updated technical report for the Essakane mine, which revealed a larger reserve base, has extended the mine’s life by an additional 1.5 years beyond previous estimates. This extension implies a longer period for gold production, enhancing the asset’s value. Additionally, the life-of-mine costs and capital expenditures are reported to be more favorable than expected, with both figures coming in below prior estimates, suggesting a more cost-efficient operation moving forward.
Furthermore, the updated reserves show a 14% increase in contained gold, despite a lower grade, which is outweighed by the significant expansion in measured & indicated resources and inferred resources, both in quantity and grade. Winder also emphasizes the Côté project in Canada as a substantial value driver for IAMGOLD, with expectations for it to begin production in early 2024. This project, accounting for the majority of IAMGOLD’s mining asset value, presents a re-rate opportunity, reinforcing the Buy rating. Overall, the improved mine life, better-than-expected cost metrics, and the potential of the Côté project contribute to a positive outlook for IAMGOLD’s stock.
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IAMGOLD (IAG) Company Description:
IAMGOLD Corp. engages in the exploration, development and production of gold and mineral resource properties. The company was founded by William D. Pugliese, Mark I. Nathanson, and Larry E. Phillips on March 27, 1990 and is headquartered in Toronto, Canada.
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