Analyzing HudBay Minerals (NYSE:HBM) and Eldorado Gold (NYSE:EGO)

HudBay Minerals (NYSE:HBM) and Eldorado Gold (NYSE:EGO) are both materials companies, but which is the superior business? We will compare the two companies based on the strength of their risk, valuation, analyst recommendations, dividends, earnings, institutional ownership and profitability.

Valuation and Earnings

This table compares HudBay Minerals and Eldorado Gold”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
HudBay Minerals	$2.21 billion	4.86	$568.50 million	$1.70	14.24
Eldorado Gold	$2.02 billion	4.46	$507.26 million	$2.82	12.20

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

Dividends

HudBay Minerals pays an annual dividend of $0.03 per share and has a dividend yield of 0.1%. Eldorado Gold pays an annual dividend of $0.30 per share and has a dividend yield of 0.9%. HudBay Minerals pays out 1.8% of its earnings in the form of a dividend. Eldorado Gold pays out 10.6% 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.

Profitability

This table compares HudBay Minerals and Eldorado Gold’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
HudBay Minerals	27.48%	9.47%	5.44%
Eldorado Gold	29.83%	10.91%	7.07%

Analyst Ratings

This is a breakdown of recent recommendations for HudBay Minerals and Eldorado Gold, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
HudBay Minerals	0	2	10	0	2.83
Eldorado Gold	0	7	6	2	2.67

HudBay Minerals presently has a consensus target price of $31.33, indicating a potential upside of 29.40%. Eldorado Gold has a consensus target price of $46.57, indicating a potential upside of 35.41%. Given Eldorado Gold’s higher possible upside, analysts plainly believe Eldorado Gold is more favorable than HudBay Minerals.

Institutional & Insider Ownership

57.8% of HudBay Minerals shares are held by institutional investors. Comparatively, 69.6% of Eldorado Gold shares are held by institutional investors. 0.3% of HudBay Minerals shares are held by insiders. Comparatively, 0.6% of Eldorado Gold shares are held by 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.

Risk & Volatility

HudBay Minerals has a beta of 1.58, suggesting that its share price is 58% more volatile than the S&P 500. Comparatively, Eldorado Gold has a beta of 0.67, suggesting that its share price is 33% less volatile than the S&P 500.

Summary

Eldorado Gold beats HudBay Minerals on 9 of the 17 factors compared between the two stocks.

About HudBay Minerals

Hudbay Minerals Inc., a diversified mining company, focuses on the exploration, development, operation, and optimization of properties in North and South America. It produces copper concentrates containing gold, silver, and molybdenum; gold concentrates containing zinc; zinc concentrates; molybdenum concentrates; and silver/gold doré. The company's flagship project is the 100% owned Constancia mine located in the Province of Chumbivilcas in southern Peru. Hudbay Minerals Inc. was founded in 1927 and is based in Toronto, Canada.

About Eldorado Gold

Eldorado Gold Corporation, together with its subsidiaries, engages in the mining, exploration, development, and sale of mineral products primarily in Turkey, Canada, Greece, and Romania. The company primarily produces gold, as well as silver, lead, and zinc. It holds a 100% interest in the Kisladag and Efemçukuru mines located in Turkey; Lamaque complex located in Canada; and Olympias, Stratoni, Skouries, Perama Hill, and Sapes gold mines located in Greece, as well as the 80.5% interest in Certej development projects located in Romania. The company was formerly known as Eldorado Corporation Ltd. and changed its name to Eldorado Gold Corporation in April 1996. Eldorado Gold Corporation was incorporated in 1996 and is headquartered in Vancouver, Canada.