Agnico Eagle Mines Limited (NYSE: AEM) and Eldorado Gold Corporation (NYSE:EGO) are both basic materials companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitabiliy, analyst recommendations, institutional ownership, dividends, risk, earnings and valuation.

Dividends

Agnico Eagle Mines Limited pays an annual dividend of $0.40 per share and has a dividend yield of 0.9%. Eldorado Gold Corporation pays an annual dividend of $0.03 per share and has a dividend yield of 1.6%. Agnico Eagle Mines Limited pays out 36.7% of its earnings in the form of a dividend. Eldorado Gold Corporation pays out 300.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Agnico Eagle Mines Limited has increased its dividend for 5 consecutive years.

Risk & Volatility

Agnico Eagle Mines Limited has a beta of -0.67, suggesting that its share price is 167% less volatile than the S&P 500. Comparatively, Eldorado Gold Corporation has a beta of 1.35, suggesting that its share price is 35% more volatile than the S&P 500.

Institutional & Insider Ownership

60.7% of Agnico Eagle Mines Limited shares are owned by institutional investors. Comparatively, 50.8% of Eldorado Gold Corporation shares are owned by institutional investors. 0.5% of Agnico Eagle Mines Limited shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent recommendations and price targets for Agnico Eagle Mines Limited and Eldorado Gold Corporation, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Agnico Eagle Mines Limited 1 3 6 0 2.50
Eldorado Gold Corporation 2 5 3 0 2.10

Agnico Eagle Mines Limited presently has a consensus target price of $55.36, suggesting a potential upside of 24.26%. Eldorado Gold Corporation has a consensus target price of $4.82, suggesting a potential upside of 153.80%. Given Eldorado Gold Corporation’s higher possible upside, analysts clearly believe Eldorado Gold Corporation is more favorable than Agnico Eagle Mines Limited.

Profitability

This table compares Agnico Eagle Mines Limited and Eldorado Gold Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Agnico Eagle Mines Limited 11.32% 5.38% 3.40%
Eldorado Gold Corporation 1.00% 1.41% 1.04%

Valuation & Earnings

This table compares Agnico Eagle Mines Limited and Eldorado Gold Corporation’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Agnico Eagle Mines Limited $2.21 billion 4.66 $932.83 million $1.09 40.87
Eldorado Gold Corporation $425.59 million 3.19 $143.89 million $0.01 190.19

Agnico Eagle Mines Limited has higher revenue and earnings than Eldorado Gold Corporation. Agnico Eagle Mines Limited is trading at a lower price-to-earnings ratio than Eldorado Gold Corporation, indicating that it is currently the more affordable of the two stocks.

Summary

Agnico Eagle Mines Limited beats Eldorado Gold Corporation on 14 of the 17 factors compared between the two stocks.

Agnico Eagle Mines Limited Company Profile

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.

Eldorado Gold Corporation Company Profile

Eldorado Gold Corporation (Eldorado) is a gold exploration, development and mining company. The Company’s geographical segments include Turkey, Brazil, Greece, Romania and Other. The Turkey segment includes the Kisladag and the Efemcukuru mines and exploration activities in Turkey. The Brazil segment includes the Vila Nova mine, Tocantinzinho project and exploration activities in Brazil. The Greece segment includes the Stratoni mine, the Olympias, Skouries, Perama Hill and Sapes projects, and exploration activities in Greece. The Romania segment includes the Certej project and exploration activities in Romania. Other segment includes operations of the Company’s corporate office and exploration activities in other countries. The Company has operations and ongoing exploration and development projects in Turkey, Greece, Brazil and Romania. Its Operating gold mines include Kisladag in Turkey, and Efemcukuru in Turkey.

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