Gold Resource (NASDAQ: GORO) and Yamana Gold (NYSE:AUY) are both basic materials companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, dividends, profitabiliy, valuation, institutional ownership, earnings and analyst recommendations.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Gold Resource and Yamana Gold, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Gold Resource 0 0 0 0 N/A
Yamana Gold 1 6 3 0 2.20

Yamana Gold has a consensus price target of $4.11, suggesting a potential upside of 65.10%. Given Yamana Gold’s higher possible upside, analysts plainly believe Yamana Gold is more favorable than Gold Resource.

Profitability

This table compares Gold Resource and Yamana Gold’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Gold Resource 17.98% 16.01% 14.43%
Yamana Gold -19.31% 0.44% 0.23%

Dividends

Yamana Gold pays an annual dividend of $0.02 per share and has a dividend yield of 0.8%. Gold Resource does not pay a dividend. Yamana Gold pays out -5.4% of its earnings in the form of a dividend.

Institutional and Insider Ownership

41.4% of Yamana Gold shares are owned by institutional investors. 2.7% of Yamana Gold shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Gold Resource and Yamana Gold’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Gold Resource $90.16 million 2.63 $27.45 million N/A N/A
Yamana Gold $1.79 billion 1.32 $543.30 million ($0.37) -6.73

Yamana Gold has higher revenue and earnings than Gold Resource.

Summary

Yamana Gold beats Gold Resource on 9 of the 13 factors compared between the two stocks.

About Gold Resource

Gold Resource Corporation is a mining company. The Company is a producer of metal concentrates that contain gold, silver, copper, lead and zinc, and dore containing gold and silver at the Aguila Project within its Oaxaca Mining Unit located in the southern state of Oaxaca, Mexico. The Company has two units in North America, the Oaxaca Mining Unit and the Nevada Mining Unit. The Company’s mineral properties are classified into two categories, such as Operating Properties and Exploration Properties. As of December 31, 2016, the Company had interest in nine properties, where over six of its properties, including one Operating Property and five Exploration Properties, are within its Oaxaca Mining Unit, which is located in the southern state of Oaxaca, Mexico. As of December 31, 2016, the Company also had three Exploration Properties within its Nevada Mining Unit located in south central Nevada’s Walker Lane Mineral Belt in the United States.

About Yamana Gold

Yamana Gold Inc. is a gold producer with gold production, gold development stage properties, exploration properties, and land positions throughout the Americas, including Canada, Brazil, Chile and Argentina. The Company’s segments include Chapada mine in Brazil; El Penon mine in Chile; Canadian Malartic mine in Canada; Gualcamayo mine in Argentina; Minera Florida mine in Chile; Jacobina mine in Brazil; Brio Gold Inc. (Brio Gold), and Corporate and other. The Company’s development projects include Cerro Moro, Argentina; Agua Rica, Argentina, and Gualcamayo, Argentina. Its exploration projects include Chapada, Brazil; El Penon, Chile; Gualcamayo, Argentina; Minera Florida, Chile; Jacobina, Brazil; Cerro Moro, Argentina; Canadian Malartic Corporation, Canada; Monument Bay, Canada; Brio Gold Exploration; Pilar, Brazil; Fazenda Brasileiro, Brazil; RDM, Brazil, and C1 Santa Luz, Brazil.

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