Analyzing Nexa Resources (NYSE:NEXA) and Hycroft Mining (NASDAQ:HYMC)

Nexa Resources (NYSE:NEXA) and Hycroft Mining (NASDAQ:HYMC) are both basic materials companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, earnings, analyst recommendations, risk, profitability, dividends and valuation.

Insider & Institutional Ownership

7.4% of Hycroft Mining shares are owned by institutional investors. 1.3% of Hycroft Mining shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Nexa Resources and Hycroft Mining”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nexa Resources	$2.77 billion	N/A	-$205.03 million	($0.12)	-84.04
Hycroft Mining	N/A	N/A	-$60.90 million	($1.62)	-16.75

Hycroft Mining has lower revenue, but higher earnings than Nexa Resources. Nexa Resources is trading at a lower price-to-earnings ratio than Hycroft Mining, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Nexa Resources and Hycroft Mining’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nexa Resources	-0.57%	-8.80%	-2.08%
Hycroft Mining	N/A	N/A	-27.55%

Analyst Recommendations

This is a breakdown of recent ratings for Nexa Resources and Hycroft Mining, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nexa Resources	2	6	0	0	1.75
Hycroft Mining	1	0	0	0	1.00

Nexa Resources presently has a consensus target price of $6.67, indicating a potential downside of 33.85%. Given Nexa Resources’ stronger consensus rating and higher possible upside, analysts clearly believe Nexa Resources is more favorable than Hycroft Mining.

Volatility and Risk

Nexa Resources has a beta of 0.57, meaning that its share price is 43% less volatile than the S&P 500. Comparatively, Hycroft Mining has a beta of 2.64, meaning that its share price is 164% more volatile than the S&P 500.

Summary

Hycroft Mining beats Nexa Resources on 7 of the 12 factors compared between the two stocks.

About Nexa Resources

Nexa Resources S.A., together with its subsidiaries, engages in the zinc mining and smelting business worldwide. The company operates in two segments, Mining and Smelting. It produces zinc, zamac, zinc oxide, and zincal, as well as by-products, such as copper, lead, silver, gold, copper sulfate, sulfuric acid, copper cementum, silver concentrate, slag aggregates, and cadmium/sponge deposits. The company owns and operates six polymetallic mines, including three located in the Central Andes of Peru; two located in the State of Minas Gerais in Brazil; and one located in the State of Mato Grosso in Brazil. It also owns and operates three zinc smelters comprising one located in Cajamarquilla in Peru; and two located in the State of Minas Gerais in Brazil, which recovers and produces metallic zinc, zinc oxide, and by-products, such as sulfuric acid. The company also exports its products. Its products are used in civil construction, transportation, energy, agriculture, health, and consumer goods industries. The company was formerly known as VM Holding S.A. and changed its name to Nexa Resources S.A. in September 2017. The company was founded in 1956 and is based in Luxembourg, Luxembourg. Nexa Resources S.A. operates as a subsidiary of Votorantim S.A.

About Hycroft Mining

Hycroft Mining Holding Corporation, together with its subsidiaries, operates as a gold and silver development company in the United States. The company holds interests in the Hycroft mine that consists of 30 private parcels with patented claims comprising approximately 1,787 acres, and 3,247 unpatented mining claims that encompass approximately 62,298 acres located in the state of Nevada. Hycroft Mining Holding Corporation is based in Winnemucca, Nevada.