Contrasting Barrick Gold (ABX) & Tahoe Resources (TAHO)

Barrick Gold (NYSE: ABX) and Tahoe Resources (NYSE:TAHO) are both basic materials companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, valuation, profitability, analyst recommendations, institutional ownership, risk and dividends.

Institutional & Insider Ownership

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52.9% of Barrick Gold shares are owned by institutional investors. Comparatively, 62.9% of Tahoe Resources shares are owned by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Barrick Gold and Tahoe Resources’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Barrick Gold $8.37 billion 1.68 $1.44 billion $1.23 9.79
Tahoe Resources $733.60 million 2.00 $81.79 million $0.26 18.00

Barrick Gold has higher revenue and earnings than Tahoe Resources. Barrick Gold is trading at a lower price-to-earnings ratio than Tahoe Resources, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Barrick Gold and Tahoe Resources’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Barrick Gold 17.17% 7.59% 3.36%
Tahoe Resources 11.15% 3.18% 2.70%

Analyst Ratings

This is a breakdown of recent recommendations for Barrick Gold and Tahoe Resources, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Barrick Gold 1 12 3 0 2.13
Tahoe Resources 0 5 1 0 2.17

Barrick Gold presently has a consensus price target of $16.49, indicating a potential upside of 36.98%. Given Barrick Gold’s higher possible upside, equities research analysts plainly believe Barrick Gold is more favorable than Tahoe Resources.

Dividends

Barrick Gold pays an annual dividend of $0.12 per share and has a dividend yield of 1.0%. Tahoe Resources does not pay a dividend. Barrick Gold pays out 9.8% of its earnings in the form of a dividend.

Risk and Volatility

Barrick Gold has a beta of -0.13, meaning that its stock price is 113% less volatile than the S&P 500. Comparatively, Tahoe Resources has a beta of 0.25, meaning that its stock price is 75% less volatile than the S&P 500.

Summary

Barrick Gold beats Tahoe Resources on 9 of the 15 factors compared between the two stocks.

Barrick Gold Company Profile

Barrick Gold Corporation (Barrick) is a gold mining company. The Company is principally engaged in the production and sale of gold and copper, as well as related activities, such as exploration and mine development. The Company’s segments include Goldstrike, Cortez, Pueblo Viejo, Lagunas Norte, Veladero, Turquoise Ridge, Acacia Mining plc (Acacia), Pascua-Lama and Other Mines. Goldstrike, Cortez, Pueblo Viejo, Lagunas Norte, Veladero and Turquoise Ridge are its individual gold mines. The Company, through its subsidiary, Acacia, owns gold mines and exploration properties in Africa. It also holds interest in gold mines, including Porgera and Kalgoorlie, and copper mines, such as Zaldivar and Lumwana. The Pascua-Lama project is located on the border between Chile and Argentina. The Company has nine producing gold mines, which are located in Canada, the United States, Peru, Argentina, Australia and the Dominican Republic.

Tahoe Resources Company Profile

Tahoe Resources Inc. is a mine operations, and mineral exploration and development company. The Company’s principal business activities are the exploration, development, operation and acquisition of mineral properties for the mining of precious metals in the Americas. Its business involves operating the Escobal mine, a silver mining operation located in southeastern Guatemala, the La Arena and Shahuindo mines, gold mining operations located in northwestern Peru, and the Bell Creek mine and mill and the Timmins West mine, gold mining operations located in northeastern Ontario, Canada. Its additional business objectives include the expansion of gold production at the Shahuindo and Bell Creek mines, the development of the Whitney Project and the ongoing exploration programs in Peru and Canada. It focuses on the initial evaluation of exploration/development projects with the main projects being the La Arena copper-gold sulfide project in Peru and the Fenn-Gib gold project in Canada.

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