Largo (NYSE:LGO) and DPM Metals (OTCMKTS:DPMLF) Financial Analysis

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

Volatility and Risk

DPM Metals has a beta of 0.7, suggesting that its stock price is 30% less volatile than the S&P 500. Comparatively, Largo has a beta of 1.5, suggesting that its stock price is 50% more volatile than the S&P 500.

Earnings & Valuation

This table compares DPM Metals and Largo”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DPM Metals	$950.48 million	8.83	$369.23 million	$3.04	12.59
Largo	$127.06 million	0.41	-$30.34 million	($1.07)	-0.43

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

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for DPM Metals and Largo, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DPM Metals	0	2	3	0	2.60
Largo	0	0	2	0	3.00

Largo has a consensus target price of $2.10, suggesting a potential upside of 357.72%. Given Largo’s stronger consensus rating and higher probable upside, analysts plainly believe Largo is more favorable than DPM Metals.

Profitability

This table compares DPM Metals and Largo’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%
Largo	-35.10%	-22.61%	-14.29%

Institutional & Insider Ownership

64.1% of Largo shares are held by institutional investors. 0.3% of DPM Metals shares are held by company insiders. Comparatively, 0.3% of Largo shares are held by company 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.

Summary

DPM Metals beats Largo on 10 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 Largo

Largo Inc. engages in the development and sale of vanadium-based energy storage systems in Canada. The company operates through, Sales & Trading, Mine Properties, Corporate, Exploration and Evaluation Properties, and Largo Clean Energy and Largo Physical Vanadium Segments. Its products include VPURE+ vanadium flakes that are used in the production of master alloys and aerospace applications; VPURE vanadium flakes ferrovanadium and vanadium carbon nitride for the steel industry; and VPURE+ vanadium powder for catalyst applications. The company offers renewable energy storage solutions through Largo Clean Energy. Its products are sourced from vanadium deposits at the Maracás Menchen Mine in Brazil. The company was formerly known as Largo Resources Ltd. and changed its name to Largo Inc. in November 2021. The company was incorporated in 1988 and is headquartered in Toronto, Canada.