Financial Contrast: McEwen (NYSE:MUX) and DPM Metals (OTCMKTS:DPMLF)

DPM Metals (OTCMKTS:DPMLF) and McEwen (NYSE:MUX) are both materials companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, dividends, risk, earnings, profitability, analyst recommendations and valuation.

Dividends

DPM Metals pays an annual dividend of $0.16 per share and has a dividend yield of 0.4%. McEwen pays an annual dividend of $0.01 per share and has a dividend yield of 0.1%. DPM Metals pays out 5.3% of its earnings in the form of a dividend. McEwen pays out 0.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Valuation and Earnings

This table compares DPM Metals and McEwen”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DPM Metals	$950.48 million	9.89	$369.23 million	$3.04	14.11
McEwen	$248.44 million	4.67	$34.43 million	$1.26	15.02

DPM Metals has higher revenue and earnings than McEwen. DPM Metals is trading at a lower price-to-earnings ratio than McEwen, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current recommendations for DPM Metals and McEwen, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DPM Metals	0	2	3	0	2.60
McEwen	0	2	3	0	2.60

McEwen has a consensus target price of $28.00, indicating a potential upside of 47.99%. Given McEwen’s higher probable upside, analysts plainly believe McEwen is more favorable than DPM Metals.

Insider & Institutional Ownership

17.0% of McEwen shares are held by institutional investors. 0.3% of DPM Metals shares are held by company insiders. Comparatively, 14.8% of McEwen shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Volatility & Risk

DPM Metals has a beta of 0.69, meaning that its share price is 31% less volatile than the S&P 500. Comparatively, McEwen has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500.

Profitability

This table compares DPM Metals and McEwen’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DPM Metals	50.26%	25.66%	21.67%
McEwen	32.46%	13.48%	9.13%

Summary

DPM Metals beats McEwen on 8 of the 14 factors compared between the two stocks.

About DPM Metals

Dundee Precious Metals Inc., a gold mining company, engages in the acquisition, exploration, development, mining, and processing of precious metals. The company primarily explores for gold, copper, and silver deposits. It holds a portfolio of projects located in Bulgaria, Namibia, Serbia, and Ecuador. The company is based in Toronto, Canada.

About McEwen

McEwen Mining Inc. engages in the exploration, development, production, and sale of gold and silver. It also explores for copper deposits. The company owns 100% interests in the El Gallo and Fenix projects located in Mexico; and the Black Fox Mine and Stock Mill, Grey Fox, and Froome and Tamarack properties in Canada. It also owns interests in the Fuller, Davidson-Tisdale, Buffalo Ankerite, and Paymaster exploration properties located in Canada; and a 49% interest in the San José mine located in Argentina. In addition, the company owns 100% interests in the Gold Bar and Tonkin properties located in Eureka County, Nevada; and interests in the Los Azules copper project located in the cordilleran region in the province of San Juan, Argentina. The company was formerly known as US Gold Corporation and changed its name to McEwen Mining Inc. in January 2012. McEwen Mining Inc. was founded in 1979 and is headquartered in Toronto, Canada.