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Opinions Jon Case
Iamgold CorpIMG.TOCOMMENTMay 30, 2014
Jon CaseStock price when the opinion was issued
As of Jun 15, 2026. Market Open.
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(Note the short timeframe.) Inflection point in 2026, where FCF will be a wall of cash. Will be one of the top 5 mines in Canada once it hits full operation. Still a takeover candidate.
Dennis da SilvaConsistent theme across his Top Picks will be companies that are going to rerate, due to new projects or a shift in business.
This one has benefited from strong gold prices, but real upside will come from the Cote gold mine around Sudbury. It will start to operate at full speed by end of 2025, meaning material growth in production. Budget doubled, but all sins are forgiven because so has the price of gold since the mine opened. They'll be able to de-leverage, resulting in significant FCF in 2026 and 2027 for either buybacks or distributions.
Key will be what happens after 2028, because their West Africa mine ends. No dividend.
Dennis da SilvaThe question was on Iamgold and Teck Resources. IMG has declared some good news from its Quebec mine and Teck has more copper production with gold as an add-on. However both operate in some places that are less politically agreeable. He likes the gold sector but prefers bigger and more diversified companies in more stable countries including the U.S., Canada, Mexico and Chile. Following along this theme he owns both Kinross and Agnico Eagle.
Great rocks. Lousy balance sheet, which needs to be fixed with refinancing and can get ugly for existing shareholders. For most investors, he'd sell and take the tax loss. Then re-buy in 31 days depending on outcome of refinancing. New CEO is an expert in troubled companies.
Rick Rule
Whole sector's been a pretty good place to be. If you're looking for real strength as far as opportunity goes, move downstream from the big names to mid-tier names like IMG. Those are the ones that are behaving quite robustly.
Often it works to buy a basket, and then drill down and add one name for some extra alpha.
Ross Healy
Ross Healy
An intermediate gold producer with about 1 million ounces a year. Costs are at the high-end of the spectrum from $900-$950 an ounce. On a cash cost basis you are probably at $1100 an ounce. Not a whole lot of margin at current gold prices. Q1 results were okay, but we are seeing grades drop off at Rosebel, one of their main mines at Surinam. This is one of their core assets. Assets are somewhat mature, so as time goes on, it will get harder and harder to process and extract the gold rock, which will jack up costs over time. He is on the sidelines right now and thinks the fundamental value is around $4.