(By Balachander) CIBC World Markets Inc. downgraded its rating on shares of IAMGOLD Corp. (NYSE: IAG) to "Sector Performer" from "Sector Outperformer" and reduced price target to US$18 from US$20, following the company's quarterly results.
The brokerage noted that IAMGOLD missed its Q3 expectations on both earnings and production. "The strong H2/12 we had hoped to see is failing to materialize and more significantly, production guidance was reduced for 2013 by 13 percent, reflecting unexpected delays at Westwood and Sadiola," wrote CIBC.
"IAG shares have outperformed in recent months with cash flow multiples recovering to average levels for the sector," CIBC said.
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"Faced with a flatter-than-expected growth profile in 2013 and lingering uncertainties at Sadiola, we think it will be difficult
for the stock to garner an above-average multiple."
CIBC thinks the catalysts for 2012 have largely played out and 2013 growth is now lower than expected and carries greater
Both Rosebel and Essakane appear to be in higher pre-strip phases of mining, with the latter posting the highest quarterly
strip ratio at 4.3 and cash cost at $594/oz, which is attributed to the elevated waste stripping ahead of new ore benches, the brokerage noted.
On the NYSE, IAG shares fell 3.17 percent to trade at $11.60 on Thursday.