Buenaventura Mining (NYSE:BVN – Get Free Report) and Gold Resource (NYSE:GORO – Get Free Report) are both materials companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, dividends, profitability and risk.
Institutional & Insider Ownership
18.4% of Gold Resource shares are owned by institutional investors. 19.3% of Buenaventura Mining shares are owned by insiders. Comparatively, 1.3% of Gold Resource shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Volatility and Risk
Buenaventura Mining has a beta of 0.43, meaning that its stock price is 57% less volatile than the S&P 500. Comparatively, Gold Resource has a beta of 1.06, meaning that its stock price is 6% more volatile than the S&P 500.
Valuation & Earnings
This table compares Buenaventura Mining and Gold Resource”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Buenaventura Mining | $1.73 billion | 3.87 | $782.15 million | $4.42 | 5.97 |
| Gold Resource | $55.34 million | 9.24 | -$16.02 million | $0.05 | 63.20 |
Buenaventura Mining has higher revenue and earnings than Gold Resource. Buenaventura Mining is trading at a lower price-to-earnings ratio than Gold Resource, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Buenaventura Mining and Gold Resource’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Buenaventura Mining | 50.88% | 26.53% | 18.88% |
| Gold Resource | -61.31% | -35.25% | -16.15% |
Analyst Recommendations
This is a breakdown of current ratings and recommmendations for Buenaventura Mining and Gold Resource, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Buenaventura Mining | 0 | 2 | 2 | 0 | 2.50 |
| Gold Resource | 0 | 1 | 1 | 0 | 2.50 |
Buenaventura Mining currently has a consensus target price of $37.25, indicating a potential upside of 41.15%. Gold Resource has a consensus target price of $1.75, indicating a potential downside of 44.62%. Given Buenaventura Mining’s higher possible upside, equities analysts plainly believe Buenaventura Mining is more favorable than Gold Resource.
Dividends
Buenaventura Mining pays an annual dividend of $1.09 per share and has a dividend yield of 4.1%. Gold Resource pays an annual dividend of $0.04 per share and has a dividend yield of 1.3%. Buenaventura Mining pays out 24.7% of its earnings in the form of a dividend. Gold Resource pays out 80.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Buenaventura Mining is clearly the better dividend stock, given its higher yield and lower payout ratio.
Summary
Buenaventura Mining beats Gold Resource on 12 of the 15 factors compared between the two stocks.
About Buenaventura Mining
Compañía de Minas Buenaventura S.A.A. engages in the exploration, development, construction, and operation of mineral processing business. The company explores for gold, silver, lead, zinc, and copper metals. It operates operating mining units, including Tambomayo located in the Caylloma province, Orcopampa Unit located in the province of Castilla, Uchucchacua located in province of Oyón, Julcani located in province of Angaraes, Peru, as well as San Gabrie located in the province of General Sánchez Cerro, in the Moquegua region. The company owns interests in Colquijirca, La Zanja, Cerro Verde, El Brocal, Coimolache, Yumpaq, San Gregorio mines, and Trapiche mining unit. In addition, it produces monohydrate manganese sulphate; and operates hydroelectric power plants. Compañía de Minas Buenaventura S.A.A. was incorporated in 1953 and is based in Lima, Peru.
About Gold Resource
Gold Resource Corporation engages in the exploration, development, and production of gold and silver projects in Mexico and the United States. The company also explores for copper, lead, and zinc deposits. Its principal assets are the 100% owned Don David gold mine and Back Forty project covering approximately 1,304 hectares located in Menominee county, Michigan. The company was incorporated in 1998 and is headquartered in Denver, Colorado.
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