Freeport-McMoRan (OTCMKTS: LUNMF) and Lundin Mining (OTCMKTS:LUNMF) are both basic materials companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, valuation, profitability, earnings, dividends, analyst recommendations and institutional ownership.

Analyst Ratings

This is a breakdown of current recommendations for Freeport-McMoRan and Lundin Mining, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Freeport-McMoRan 1 11 6 0 2.28
Lundin Mining 0 2 0 0 2.00

Freeport-McMoRan presently has a consensus target price of $17.91, indicating a potential upside of 31.90%. Given Freeport-McMoRan’s stronger consensus rating and higher probable upside, analysts clearly believe Freeport-McMoRan is more favorable than Lundin Mining.

Risk & Volatility

Freeport-McMoRan has a beta of 2.5, indicating that its stock price is 150% more volatile than the S&P 500. Comparatively, Lundin Mining has a beta of 1.75, indicating that its stock price is 75% more volatile than the S&P 500.

Insider & Institutional Ownership

71.8% of Freeport-McMoRan shares are held by institutional investors. Comparatively, 0.0% of Lundin Mining shares are held by institutional investors. 1.1% of Freeport-McMoRan shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Dividends

Freeport-McMoRan pays an annual dividend of $0.20 per share and has a dividend yield of 1.5%. Lundin Mining pays an annual dividend of $0.09 per share and has a dividend yield of 1.8%. Freeport-McMoRan pays out 17.1% of its earnings in the form of a dividend.

Profitability

This table compares Freeport-McMoRan and Lundin Mining’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Freeport-McMoRan 14.87% 24.01% 7.50%
Lundin Mining 20.49% 10.42% 6.58%

Earnings & Valuation

This table compares Freeport-McMoRan and Lundin Mining’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Freeport-McMoRan $16.40 billion 1.20 $1.82 billion $1.17 11.61
Lundin Mining $2.08 billion 1.75 $426.48 million N/A N/A

Freeport-McMoRan has higher revenue and earnings than Lundin Mining.

Summary

Freeport-McMoRan beats Lundin Mining on 11 of the 15 factors compared between the two stocks.

About Freeport-McMoRan

Freeport-McMoRan Inc. engages in the mining of mineral properties in the United States, Indonesia, Peru, and Chile. The company primarily explores for copper, gold, molybdenum, silver, and other metals, as well as oil and gas. Its assets include the Grasberg minerals district in Indonesia; Morenci, Bagdad, Safford, Sierrita, and Miami in Arizona; Tyrone and Chino in New Mexico; and Henderson and Climax in Colorado, North America, as well as Cerro Verde and El Abra mines in South America. It also operates a portfolio of oil and gas assets comprising oil and natural gas production onshore in South Louisiana; and on the Gulf of Mexico shelf and oil production offshore California. As of December 31, 2017, the company's estimated consolidated recoverable proven and probable mineral reserves totaled 86.7 billion pounds of copper, 23.5 million ounces of gold, and 2.84 billion pounds of molybdenum, as well as estimated proved developed oil and natural gas reserves totaled 10.1 million barrels of oil equivalents. The company was formerly known as Freeport-McMoRan Copper & Gold Inc. and changed its name to Freeport-McMoRan Inc. in July 2014. Freeport-McMoRan Inc. was founded in 1987 and is headquartered in Phoenix, Arizona.

About Lundin Mining

Lundin Mining Corporation, a diversified base metals mining company, engages in the exploration, development, and mining of mineral properties in Chile, the United States, Portugal, and Sweden. It primarily produces copper, zinc, and nickel, as well as gold, lead, silver, and other metals. The company holds 100% interest in the Eagle mine located in the United States; the Neves-Corvo mine located in Portugal; and the Zinkgruvan mine located in Sweden, as well as 80% interest in Candelaria and Ojos del Salado mining complex; and 24% interest the Freeport Cobalt Oy business, which includes a cobalt refinery located in Kokkola, Finland. The company was formerly known as South Atlantic Ventures Ltd. and changed its name to Lundin Mining Corporation in August 2004. Lundin Mining Corporation was incorporated in 1994 and is headquartered in Toronto, Canada.

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