DRDGOLD Limited (NYSE: DRD) and AngloGold Ashanti Limited (NYSE:AU) are both basic materials companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, valuation, profitability, analyst recommendations, dividends, institutional ownership and risk.

Risk and Volatility

DRDGOLD Limited has a beta of -1.96, suggesting that its stock price is 296% less volatile than the S&P 500. Comparatively, AngloGold Ashanti Limited has a beta of -1.37, suggesting that its stock price is 237% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations and price targets for DRDGOLD Limited and AngloGold Ashanti Limited, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
DRDGOLD Limited 0 1 0 0 2.00
AngloGold Ashanti Limited 1 4 3 0 2.25

AngloGold Ashanti Limited has a consensus price target of $12.43, suggesting a potential upside of 28.01%. Given AngloGold Ashanti Limited’s stronger consensus rating and higher probable upside, analysts plainly believe AngloGold Ashanti Limited is more favorable than DRDGOLD Limited.

Dividends

DRDGOLD Limited pays an annual dividend of $0.07 per share and has a dividend yield of 2.1%. AngloGold Ashanti Limited pays an annual dividend of $0.09 per share and has a dividend yield of 0.9%. AngloGold Ashanti Limited has increased its dividend for 4 consecutive years.

Profitability

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

Net Margins Return on Equity Return on Assets
DRDGOLD Limited N/A N/A N/A
AngloGold Ashanti Limited N/A N/A N/A

Institutional and Insider Ownership

26.6% of DRDGOLD Limited shares are owned by institutional investors. Comparatively, 35.9% of AngloGold Ashanti Limited shares are owned by institutional investors. 1.0% of DRDGOLD Limited shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings & Valuation

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

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
DRDGOLD Limited $187.84 million 0.74 $19.66 million N/A N/A
AngloGold Ashanti Limited $4.08 billion 0.97 $1.34 billion N/A N/A

AngloGold Ashanti Limited has higher revenue and earnings than DRDGOLD Limited.

Summary

AngloGold Ashanti Limited beats DRDGOLD Limited on 10 of the 12 factors compared between the two stocks.

About DRDGOLD Limited

DRDGOLD Limited is a gold mining company. The Company is engaged in gold production by tailings retreatment. The Company is focused on the recovery of lower-risk, higher-margin ounces primarily from its metallurgical plant located approximately 50 kilometers east of Johannesburg in Brakpan. The Company owns approximately 100% of its holding company, Ergo Mining Operations Proprietary Limited (EMO). Ergo Mining Proprietary Limited (Ergo) is owned by EMO. Ergo has a vast footprint adjacent to Johannesburg on the central and eastern Witwatersrand of South Africa. Its assets cover an area of approximately 62 kilometers from east to west and over 25 kilometers from north to south. The Ergo operation has over two metallurgical plants in operation, including Knights plant and The Ergo plant. The Knights plant in Germiston is treating the Cason dump and depositing waste on the Brakpan tailings facility (BTF). The Ergo plant has a total treatment capacity of 300,000 tons per month (tpm).

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.

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