Although the stock has already outperformed the S&P 500 by more than 137% since I added the pick to my Motley Fool CAPS portfolio back in 2006, IAMBULLISH on IAMGOLD (NYSE: IAG). With my record of prior calls about the stock archived for all to see, and another 36% advance since that last buy recommendation in February 2010, I am reiterating my expectation for a resumption of upward momentum in the shares.

IAMGOLD issued an update this week, warning that second-quarter production will come in below prior guidance and at higher-than-anticipated costs. Because markets are inherently short-sighted, I view any weakness in the shares resulting from this momentary hiccup as an attractive opportunity to climb aboard this proven outperformer of the gold patch.

Despite the setback, IAMGOLD continues to expect 2011 production of 1.1 million to 1.2 million ounces of gold, not to mention up to 5 million kilograms of niobium. Confident in its cash flow outlook even amid an aggressive capital spending initiative, IAMGOLD this week announced a 150% increase in its annual dividend to $0.20 per share. The resulting 1% annualized yield is actually better than that of rival Goldcorp (NYSE: GG) and furthers the sector's steady improvement from an income-generation perspective.

IAMGOLD is feeling some upward pressure on costs from higher fuel, labor, and other inputs, but this is a reflection of an industrywide condition that we are likely to see in subsequent results from midtier peers such as Eldorado Gold (NYSE: EGO) and Yamana Gold (NYSE: AUY). As far as this Fool can tell, gold continues to move higher at a faster clip than costs, and so I forecast the industry's impressive margin expansion trend to continue.

Looking back to IAMGOLD, we find the company flush with cash from its recent sale of minority-interest assets to Gold Fields (NYSE: GFI) in April and empowered with a plan to drive meaningful organic growth through a $1.2 billion investment (over three years) in capacity expansion at several of its key producing mines. Responding to demand growth for niobium that has averaged 10% annually, IAMGOLD foresees a potential tripling of niobium output to 15 million kilograms. The company recently announced a massive 691% increase in the Niobec mine's measured and indicated resource, and calculated an after-tax net asset value of at least $1.6 billion. With that enhanced understanding of the deposit's significance in place, IAMGOLD now seeks to spin out a 10% to 20% stake in the project to the public, and I can't help but imagine that the resulting entity might eventually target an acquisition of Taseko Mines' (AMEX: TGB) own enticing niobium discovery.

Although the gold patch offers myriad growth vehicles that I consider capable of delivering outstanding shareholder returns for years to come, IAMGOLD has earned a stable spot in my own portfolio by consistently executing on well-devised avenues for strategic growth. I see more of the same going forward and encourage Fools to swoop in for a close inspection.