Hecla Mining (NYSE:HL) versus Mesabi Trust (NYSE:MSB) Financial Review

Hecla Mining (NYSE:HL) and Mesabi Trust (NYSE:MSB) are both materials companies, but which is the superior business? We will contrast the two businesses based on the strength of their dividends, earnings, profitability, institutional ownership, analyst recommendations, valuation and risk.

Risk & Volatility

Hecla Mining has a beta of 1.37, suggesting that its share price is 37% more volatile than the S&P 500. Comparatively, Mesabi Trust has a beta of 0.32, suggesting that its share price is 68% less volatile than the S&P 500.

Profitability

This table compares Hecla Mining and Mesabi Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hecla Mining	20.84%	18.91%	14.58%
Mesabi Trust	54.46%	33.50%	28.16%

Insider & Institutional Ownership

63.0% of Hecla Mining shares are owned by institutional investors. 0.7% of Hecla Mining shares are owned by insiders. Comparatively, 0.3% of Mesabi Trust shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Dividends

Hecla Mining pays an annual dividend of $0.01 per share and has a dividend yield of 0.1%. Mesabi Trust pays an annual dividend of $0.20 per share and has a dividend yield of 1.0%. Hecla Mining pays out 2.0% of its earnings in the form of a dividend. Mesabi Trust pays out 40.8% 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.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Hecla Mining and Mesabi Trust, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hecla Mining	1	5	4	0	2.30
Mesabi Trust	0	1	0	0	2.00

Hecla Mining presently has a consensus target price of $23.34, indicating a potential upside of 55.57%. Given Hecla Mining’s stronger consensus rating and higher possible upside, analysts clearly believe Hecla Mining is more favorable than Mesabi Trust.

Valuation & Earnings

This table compares Hecla Mining and Mesabi Trust”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hecla Mining	$1.42 billion	7.08	$321.71 million	$0.49	30.62
Mesabi Trust	$17.52 million	14.34	$13.87 million	$0.49	39.08

Hecla Mining has higher revenue and earnings than Mesabi Trust. Hecla Mining is trading at a lower price-to-earnings ratio than Mesabi Trust, indicating that it is currently the more affordable of the two stocks.

Summary

Hecla Mining beats Mesabi Trust on 9 of the 15 factors compared between the two stocks.

About Hecla Mining

Hecla Mining Company, together with its subsidiaries, provides precious and base metal properties in the United States, Canada, Japan, Korea, and China. The company mines for silver, gold, lead, and zinc concentrates, as well as carbon material containing silver and gold for custom smelters, metal traders, and third-party processors; and doré containing silver and gold. It flagship project is the Greens Creek mine located on Admiralty Island in southeast Alaska. Hecla Mining Company was incorporated in 1891 and is headquartered in Coeur d'Alene, Idaho.

About Mesabi Trust

Mesabi Trust, a royalty trust, engages in iron ore mining business in the United States. Mesabi Trust was founded in 1961 and is based in New York, New York.