In the field of growth investing, joining a solid technical system with firm fundamental momentum can be an effective way to spot possible leading stocks. One organized technique for this is joining Mark Minervini’s Trend Template with a High Growth Momentum (HGM) screen. The Trend Template gives a fixed group of technical rules meant to find stocks in strong, confirmed uptrends, concentrating on price movement, moving average order, and relative performance. Adding a high growth check tries to make sure the company is not only technically good but also showing the fast earnings and sales growth that frequently supports continued price gains. This two-part method tries to locate securities where notable technical force is supported by fundamental speed.
IAMGOLD CORP (NYSE:IAG) appears as a present instance that meets this joined filter, offering a study in how a gold mining company can show features usually looked for by momentum and growth investors.
Meeting the Minervini Trend Template
The center of Minervini’s plan is the Trend Template, a list that imposes control by confirming a stock is in a clear, forceful uptrend before review. IAMGOLD presently meets these important technical requirements:
- Price Above Key Moving Averages: The stock’s last price of $22.20 trades well above its rising 50-day ($18.45), 150-day ($13.57), and 200-day ($11.95) simple moving averages (SMAs). This order confirms the stock is in a positive stage across short, medium, and long-term periods.
- Positive Moving Average Alignment: The 50-day SMA is above both the 150-day and 200-day SMAs, and the 150-day SMA is above the 200-day SMA. This "stacked" order shows steady buying force and a sound, speeding uptrend.
- Proximity to Highs: At $22.20, IAG is trading within 4% of its 52-week high of $23.06, easily within the Template's need of being within 25% of the high. This shows force and an absence of overhead supply. At the same time, the price is over 340% above its 52-week low of $5.02, greatly passing the 30% limit and indicating a forceful recovery trend.
- Superior Relative Strength: With a ChartMill Relative Strength (CRS) score of 98.7, IAG is doing better than nearly 99% of all stocks in the market over the past year. High relative strength is a key part of the Minervini idea, as it finds market leaders that tend to lead rallies and show lasting strength.
This technical view satisfies the Trend Template’s goal: to filter for stocks that are already in a confirmed Stage 2 rise, thus avoiding those in basing or falling stages and focusing money on issues with shown momentum.
Qualifying as a High Growth Momentum Candidate
While the Trend Template handles the "how," the High Growth Momentum rating tries to answer the "why" behind the price move. For a stock to maintain a forceful trend, it usually needs a fundamental driver. IAMGOLD’s recent financial measures show the type of fast growth that can draw institutional attention and drive re-ratings.
- Earnings Growth Speed Increase: The company’s earnings per share (EPS) growth is notable. Trailing twelve-month (TTM) EPS grew by over 123% year-over-year. More importantly, the most recent quarterly EPS rose nearly 600% compared to the same quarter last year, showing a major speed increase in profitability.
- Strong Revenue Growth: Top-line growth is also notable, with TTM revenue up about 75%. The latest quarter saw revenue rise over 131% year-over-year, pointing to good operational performance and possibly higher realized gold prices adding to results.
- Getting Better Profitability: The profit margin in the last reported quarter was about 37%, a large rise from 19.7% in the prior quarter and 8.3% three quarters ago. This pattern of growing margins is a main quality filter in growth investing, as it shows the company is not only growing sales but also becoming more efficient and profitable.
- Positive Analyst Revisions: The average analyst estimate for next year’s EPS has been changed upward by over 15% in the last three months. Upward revisions are a key momentum sign, often coming before further price gains as the market includes better future expectations.
These fundamental parts give the possible driver that Minervini’s SEPA (Specific Entry Point Analysis) method highlights. The forceful technical breakout is backed by a fundamental story of dramatic earnings and margin gain, which can make a self-supporting cycle of investor interest.
Technical Health and Setup Assessment
Beyond the exact Trend Template rules, a wider look at IAG’s technical health is positive. According to ChartMill’s own analysis, the stock gets a perfect Technical Rating of 10 out of 10. This score shows outstanding force across many periods and measures. The long-term and short-term trends are both rated as positive, and the stock is doing better than 89% of its group in the Metals & Mining industry.
The analysis notes the stock has been trading in a wide range over the past month and is presently near the top of that range. While this shows strong momentum, it also suggests that for new entries, waiting for a constructive pullback or consolidation might give a more favorable risk/reward setup. The report finds key support levels near $19.09 and $17.39 from trendlines, with a resistance area between $22.21 and $22.49.
You can check the full, detailed technical breakdown for IAG here: ChartMill Technical Analysis Report for IAG.
Conclusion
IAMGOLD Corp offers a notable case where a traditional commodity stock is showing behavior matched with high-growth momentum plans. It meets the controlled technical list of the Minervini Trend Template, confirming its part in a strong market uptrend. At the same time, its exceptional recent growth in earnings, sales, and profitability gives the fundamental "fuel" that can maintain such a trend, making it fit for high-growth investor attention. As always, the present technical position suggests the price is high in the short term, highlighting the need for exact entry points and firm risk control, key features of the plans discussed.
Interested in finding other stocks that meet this mix of strong trends and high growth? You can run the same screen using this link: High Growth Momentum + Trend Template Screen on ChartMill.
Disclaimer: This article is for informational and educational purposes only. It is not intended as investment advice, a recommendation, or an offer to buy or sell any security. The analysis is based on data provided and reflects conditions at a specific point in time. Investors should conduct their own thorough research and consider their individual financial situation and risk tolerance before making any investment decisions. Please read our full disclaimer here.