Long-established in the Metals & Mining industry, Iamgold Corp (IAG, Financial) has enjoyed a stellar reputation. It has recently witnessed a daily gain of 7.67%, juxtaposed with a three-month change of -24.17%. However, fresh insights from the GF Score hint at potential headwinds. Notably, its diminished rankings in financial strength, growth, and valuation suggest that the company might not live up to its historical performance. Join us as we dive deep into these pivotal metrics to unravel the evolving narrative of Iamgold Corp.
What Is the GF Score?
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
- Financial strength rank: 5/10
- Profitability rank: 4/10
- Growth rank: 1/10
- GF Value rank: 5/10
- Momentum rank: 6/10
Based on the above method, GuruFocus assigned Iamgold Corp the GF Score of 62 out of 100, which signals poor future outperformance potential.
Understanding Iamgold Corp Business
Iamgold Corp is a mid-tier gold mining company operating in three regions globally: North America, South America, and West Africa. It has a market cap of $1.05 billion and sales of $733.2 million. The company's operating margin stands at 1.1%. Its operating mines include Essakane in Burkina Faso, Rosebel in Suriname, and Westwood in Canada. A solid base of strategic assets is complemented by the Cote Gold construction project in Canada, the Boto Gold development project in Senegal, as well as greenfield and brownfield exploration projects in various countries located in the Americas and West Africa.
Financial Strength Breakdown
Iamgold Corp's financial strength indicators present some concerning insights about the company's balance sheet health. The company has an interest coverage ratio of 1.74, which positions it worse than 94.99% of 1356 companies in the Metals & Mining industry. This ratio highlights potential challenges the company might face when handling its interest expenses on outstanding debt. The company's Altman Z-Score is just 0.55, which is below the distress zone of 1.81. This suggests that the company may face financial distress over the next few years. Additionally, the company's low cash-to-debt ratio at 0.77 indicates a struggle in handling existing debt levels.
Profitability Breakdown
Iamgold Corp's low Profitability rank can also raise warning signals.
Growth Prospects
A lack of significant growth is another area where Iamgold Corp seems to falter, as evidenced by the company's low Growth rank. The company's revenue has declined by -3.2 per year over the past three years, which underperforms worse than 78.63% of 599 companies in the Metals & Mining industry. Stagnating revenues may pose concerns in a fast-evolving market. Lastly, Iamgold Corp predictability rank is just one star out of five, adding to investor uncertainty regarding revenue and earnings consistency.
Next Steps
Given the company's financial strength, profitability, and growth metrics, the GF Score highlights the firm's unparalleled position for potential underperformance. It's crucial for investors to consider these factors when making investment decisions. GuruFocus Premium members can find more companies with strong GF Scores using the following screener link: GF Score Screen.
