AngloGold Ashanti Limited (NYSE: AU) and Agnico Eagle Mines Limited (NYSE:AEM) are both mid-cap basic materials companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, earnings, dividends, risk, profitabiliy, analyst recommendations and institutional ownership.

Insider & Institutional Ownership

35.9% of AngloGold Ashanti Limited shares are held by institutional investors. Comparatively, 60.7% of Agnico Eagle Mines Limited shares are held by institutional investors. 0.5% of Agnico Eagle Mines Limited shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent recommendations for AngloGold Ashanti Limited and Agnico Eagle Mines Limited, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AngloGold Ashanti Limited 1 4 3 0 2.25
Agnico Eagle Mines Limited 1 3 6 0 2.50

AngloGold Ashanti Limited currently has a consensus target price of $12.43, indicating a potential upside of 36.00%. Agnico Eagle Mines Limited has a consensus target price of $55.36, indicating a potential upside of 23.57%. Given AngloGold Ashanti Limited’s higher possible upside, equities analysts plainly believe AngloGold Ashanti Limited is more favorable than Agnico Eagle Mines Limited.

Earnings & Valuation

This table compares AngloGold Ashanti Limited and Agnico Eagle Mines Limited’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
AngloGold Ashanti Limited $4.08 billion 0.92 $1.34 billion N/A N/A
Agnico Eagle Mines Limited $2.21 billion 4.69 $932.83 million $1.09 41.10

AngloGold Ashanti Limited has higher revenue and earnings than Agnico Eagle Mines Limited.

Profitability

This table compares AngloGold Ashanti Limited and Agnico Eagle Mines Limited’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AngloGold Ashanti Limited N/A N/A N/A
Agnico Eagle Mines Limited 11.32% 5.38% 3.40%

Risk & Volatility

AngloGold Ashanti Limited has a beta of -1.37, suggesting that its stock price is 237% less volatile than the S&P 500. Comparatively, Agnico Eagle Mines Limited has a beta of -0.67, suggesting that its stock price is 167% less volatile than the S&P 500.

Dividends

AngloGold Ashanti Limited pays an annual dividend of $0.09 per share and has a dividend yield of 1.0%. Agnico Eagle Mines Limited pays an annual dividend of $0.40 per share and has a dividend yield of 0.9%. Agnico Eagle Mines Limited pays out 36.7% of its earnings in the form of a dividend. AngloGold Ashanti Limited has increased its dividend for 5 consecutive years. AngloGold Ashanti Limited is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Agnico Eagle Mines Limited beats AngloGold Ashanti Limited on 9 of the 15 factors compared between the two stocks.

About AngloGold Ashanti Limited

AngloGold Ashanti Limited (AngloGold Ashanti) is a gold mining company. The Company’s business activities span the spectrum of the mining value chain. Its main product is gold. Its portfolio includes over 17 mines in approximately nine countries. It also produces silver, uranium and sulfuric acid as by-products. The Company operates through four segments: South Africa, Continental Africa, Australasia and Americas. Its South African operations comprise over four mines and surface production facilities, which include the Vaal River operations, including Kopanang and Moab Khotsong; The West Wits operations, including Mponeng and TauTona, and surface operations. It has operations in Continental Africa in locations, including Democratic Republic of the Congo, Ghana, Guinea, Mali and Tanzania. The Australasia segment includes the operations in Australia. It consists of Sunrise Dam and Tropicana. The Americas segment includes the operations in Argentina, Brazil and the United States.

About Agnico Eagle Mines Limited

Agnico Eagle Mines Limited is a gold producer with mining operations in northwestern Quebec, northern Mexico, northern Finland and Nunavut and exploration activities in Canada, Europe, Latin America and the United States. The Company operates through three business units. The Northern Business consists of its operations in Canada and Finland. The Company’s Canadian properties include the LaRonde mine, the Lapa mine, the Goldex mine, the Meadowbank mine and the Meliadine project, and Canadian Malartic Mine. The operations in Finland include the Kittila mine. The Southern Business consists of its operations in Mexico. Its Pinos Altos mine includes the Creston Mascota deposit. The La India mine is owned by its indirect subsidiary. Its Exploration group focuses on the identification of new mineral reserves and mineral resources, and new development opportunities in gold producing regions. Its exploration activities are concentrated in Canada, Europe, Latin America and the United States.

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