OR Royalties (NYSE:OR) & Teck Resources (NYSE:TECK) Head to Head Contrast

Teck Resources (NYSE:TECK) and OR Royalties (NYSE:OR) are both basic materials companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, valuation, profitability, risk, dividends, earnings and analyst recommendations.

Analyst Ratings

This is a summary of current ratings and price targets for Teck Resources and OR Royalties, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Teck Resources	0	12	6	2	2.50
OR Royalties	0	4	5	1	2.70

Teck Resources presently has a consensus target price of $59.67, suggesting a potential upside of 2.28%. OR Royalties has a consensus target price of $46.50, suggesting a potential upside of 15.88%. Given OR Royalties’ stronger consensus rating and higher possible upside, analysts plainly believe OR Royalties is more favorable than Teck Resources.

Dividends

Teck Resources pays an annual dividend of $0.37 per share and has a dividend yield of 0.6%. OR Royalties pays an annual dividend of $0.22 per share and has a dividend yield of 0.5%. Teck Resources pays out 18.3% of its earnings in the form of a dividend. OR Royalties pays out 20.2% 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. OR Royalties has increased its dividend for 1 consecutive years. Teck Resources is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider and Institutional Ownership

78.1% of Teck Resources shares are owned by institutional investors. Comparatively, 68.5% of OR Royalties shares are owned by institutional investors. 0.1% of Teck Resources shares are owned by insiders. Comparatively, 0.6% of OR Royalties shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Teck Resources and OR Royalties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Teck Resources	12.98%	5.90%	3.43%
OR Royalties	74.30%	12.41%	11.19%

Earnings and Valuation

This table compares Teck Resources and OR Royalties”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Teck Resources	$7.70 billion	3.65	$1.00 billion	$2.02	28.88
OR Royalties	$277.37 million	27.14	$206.09 million	$1.09	36.81

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

Volatility and Risk

Teck Resources has a beta of 0.85, meaning that its stock price is 15% less volatile than the S&P 500. Comparatively, OR Royalties has a beta of 0.83, meaning that its stock price is 17% less volatile than the S&P 500.

About Teck Resources

Teck Resources Limited engages in exploring for, acquiring, developing, and producing natural resources in Asia, Europe, and North America. The company operates through Steelmaking Coal, Copper, Zinc, and Energy segments. Its principal products include copper, zinc, steelmaking coal, and blended bitumen. The company also produces lead, silver, and molybdenum; and various specialty and other metals, chemicals, and fertilizers. In addition, it explores for gold. The company was formerly known as Teck Cominco Limited and changed its name to Teck Resources Limited in April 2009. The company was founded in 1913 and is headquartered in Vancouver, Canada.

About OR Royalties

Osisko Gold Royalties Ltd acquires and manages precious metal and other royalties, streams, and other interests in Canada and internationally. It also owns options on offtake; royalty/stream financings; and exclusive rights to participate in future royalty/stream financings on various projects. The company’s primary asset is a 3-5% net smelter return royalty on the Canadian Malartic complex located in Canada. In addition, it is involved in the exploration, evaluation, and development of mining projects. It primarily explores for precious metals, including gold, silver, diamond, and others. Osisko Gold Royalties Ltd was founded in 2014 and is headquartered in Montreal, Canada.