Trade-Ideas: Iamgold (IAG) Is Today's

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Iamgold ( IAG) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Iamgold as such a stock due to the following factors:

  • IAG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $28.1 million.
  • IAG has traded 491,517 shares today.
  • IAG is up 3% today.
  • IAG was down 12% yesterday.

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More details on IAG:

IAMGOLD Corporation engages in the exploration, development, and operation of mining properties. Its products include gold, silver, niobium, and copper deposits. The stock currently has a dividend yield of 6.5%. IAG has a PE ratio of 16.2. Currently there are 2 analysts that rate Iamgold a buy, 3 analysts rate it a sell, and 6 rate it a hold.

The average volume for Iamgold has been 6.6 million shares per day over the past 30 days. Iamgold has a market cap of $1.5 billion and is part of the basic materials sector and metals & mining industry. Shares are up 23.1% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Iamgold as a hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, feeble growth in the company's earnings per share and deteriorating net income.

Highlights from the ratings report include:
  • IAG's debt-to-equity ratio is very low at 0.17 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, IAG has a quick ratio of 2.22, which demonstrates the ability of the company to cover short-term liquidity needs.
  • IAG, with its decline in revenue, underperformed when compared the industry average of 3.9%. Since the same quarter one year prior, revenues fell by 12.7%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The gross profit margin for IAMGOLD CORP is currently lower than what is desirable, coming in at 27.22%. It has decreased significantly from the same period last year. Along with this, the net profit margin of 8.62% trails that of the industry average.
  • Net operating cash flow has decreased to $64.90 million or 34.24% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.

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