Is IAMGold a Value Play Today?

IAMGold (TSX:IMG)(NYSE:IAG) is a Toronto-based gold producer. Shares were up 2.4% in mid-afternoon trading on May 13. The spot price of gold gained momentum to start the week as trade tensions between the United States and China have ramped up.

The chances of a deal appear to be shrinking with each passing moment, and China is set to retaliate with its own set of tariffs on June 1.

These events have some investors flocking to the yellow metal. IAMGold hit a 52-week low of $3.15 in trading last week. The company released its first-quarter results on May 6.

IAMGold reported a net loss of $41.3 million or $0.09 per share.

Revenues dropped to $251 million compared to $314.5 million in the prior year. Gold production fell to 185,000 ounces compared to 229,000 ounces in Q1 2018 while gold sales also tumbled year over year.

The company encountered difficulties at its top mines. Increased seismicity at Westwood in December 2018 led to lower production, as did lower head grades at Essakane and Joint Ventures.

Regardless, IAMGold has maintained its full-year 2019 production guidance. Gold production is forecast to improve in the second quarter of 2019.

IAMGold stock plunged into technically oversold territory in its post-earnings dip. Shares had an RSI of 30 as of this writing, which puts it just on the cusp of a buy signal. Global trade tensions and high valuations in the broader market should have investors considering a gold play in the spring.

IAMGold boasts a nice value today and is positioned to bounce back in Q2 2019.