IAMGOLD Corp T.IMG

tgt increased to $10.00 from 9.50

[goldish]

TDSI morning Action Notes TD Waterhouse 
Steven J. Green, CFA Scott Parsons, CFA (Associate)

(IMG-T, IAG-N) C$8.42

Solid Q4; 2009 Cost Guidance Slightly Above Expectations

Event

IAMGOLD reported Q4/08 operational results and provided 2009 guidance.

Impact

We are now including Essakane in our NAV estimate and increasing our

target by $0.50 due to the resulting increase in NAV.

Details

Q4 Operational Results – Production Well Above Guidance

• Q4 production totaled 255,000 oz – this was well above our estimate of

229,000 oz and implied guidance of 208,000 oz.

• For the year the company produced 997,000 oz – above 2008 guidance

of 950,000 oz. Cash costs were not provided; however full year

costs are expected to be near initial guidance of

$455-470/oz - we believe the high end of the range

is more likely which would imply Q4 cash costs of

approx. $461/oz

Valuation

We calculate a base case NAV for IAMGOLD of C$9.93 ($9.50 previously) reflecting changes to our model and the addition of Essakane. IAMGOLD currently trades at 0.8 times NAV and 8 times 2009E cash flow. This is a discount to its mid-tier producing peer average of 1.0 times NAV and 10 times cash flow, and a significant discount to the 1.7x NAV average for the large cap producers.

Justification of Target Price

We have arrived at our target price of $10.00 (up from $9.50) by using a 1.0x NAV multiple.