Fortuna Silver Mines (NYSE:FSM) and TRX Gold (NYSE:TRX) Head-To-Head Review

Fortuna Silver Mines (NYSE:FSM) and TRX Gold (NYSE:TRX) are both small-cap basic materials companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, valuation, analyst recommendations, earnings, profitability, institutional ownership and dividends.

Insider & Institutional Ownership

33.8% of Fortuna Silver Mines shares are held by institutional investors. Comparatively, 1.1% of TRX Gold shares are held by institutional investors. 1.0% of Fortuna Silver Mines shares are held by insiders. Comparatively, 2.3% of TRX Gold shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Risk and Volatility

Fortuna Silver Mines has a beta of 1.63, suggesting that its share price is 63% more volatile than the S&P 500. Comparatively, TRX Gold has a beta of 0.65, suggesting that its share price is 35% less volatile than the S&P 500.

Profitability

This table compares Fortuna Silver Mines and TRX Gold’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Fortuna Silver Mines	-5.99%	5.03%	3.34%
TRX Gold	0.70%	-1.68%	-1.19%

Valuation & Earnings

This table compares Fortuna Silver Mines and TRX Gold’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Fortuna Silver Mines	$842.43 million	1.65	-$50.84 million	($0.16)	-28.41
TRX Gold	$38.32 million	3.45	$2.25 million	$0.01	47.48

TRX Gold has lower revenue, but higher earnings than Fortuna Silver Mines. Fortuna Silver Mines is trading at a lower price-to-earnings ratio than TRX Gold, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings and price targets for Fortuna Silver Mines and TRX Gold, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Fortuna Silver Mines	0	1	0	0	2.00
TRX Gold	0	0	2	0	3.00

Fortuna Silver Mines presently has a consensus price target of $7.63, indicating a potential upside of 67.77%. TRX Gold has a consensus price target of $1.58, indicating a potential upside of 232.07%. Given TRX Gold’s stronger consensus rating and higher possible upside, analysts clearly believe TRX Gold is more favorable than Fortuna Silver Mines.

Summary

TRX Gold beats Fortuna Silver Mines on 9 of the 14 factors compared between the two stocks.

About Fortuna Silver Mines

Fortuna Silver Mines Inc. engages in the precious and base metal mining in Argentina, Burkina Faso, Mexico, Peru, and Côte d'Ivoire. It operates through Mansfield, Sanu, Sango, Cuzcatlan, Bateas, and Corporate segments. The company primarily explores for silver, lead, zinc, and gold. Its flagship project is the Séguéla gold mine, which consists of approximately 62,000 hectares and is located in the Worodougou Region of the Woroba District, Côte d'Ivoire. The company was formerly known as Fortuna Ventures Inc. and changed its name to Fortuna Silver Mines Inc. in June 2005. Fortuna Silver Mines Inc. was incorporated in 1990 and is based in Vancouver, Canada.

About TRX Gold

TRX Gold Corporation engages in the exploration, development, and production of mineral property interests in the United Republic of Tanzania. The company primarily explores for gold deposits. It holds interests in the Buckreef gold project that comprises a single Special Mining License covering an area of 16.04 square kilometers and 12 Prospecting Licenses covering 98.19 square kilometers located in north-central Tanzania. The company was formerly known as Tanzanian Gold Corporation and changed its name to TRX Gold Corporation in May 2022. TRX Gold Corporation was incorporated in 1990 and is based in Oakville, Canada.