DRDGOLD Limited (NYSE: DRD) and Sibanye Gold Limited (NYSE:SBGL) are both small-cap 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, profitabiliy, dividends and valuation.
Volatility and Risk
DRDGOLD Limited has a beta of -1.91, suggesting that its share price is 291% less volatile than the S&P 500. Comparatively, Sibanye Gold Limited has a beta of -0.17, suggesting that its share price is 117% less volatile than the S&P 500.
Institutional and Insider Ownership
26.7% of DRDGOLD Limited shares are held by institutional investors. Comparatively, 14.0% of Sibanye Gold Limited shares are held by institutional investors. 1.0% of DRDGOLD Limited shares are held 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.
DRDGOLD Limited pays an annual dividend of $0.07 per share and has a dividend yield of 2.3%. Sibanye Gold Limited pays an annual dividend of $0.32 per share and has a dividend yield of 6.5%. Sibanye Gold Limited has raised its dividend for 4 consecutive years. Sibanye Gold Limited is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Earnings & Valuation
This table compares DRDGOLD Limited and Sibanye Gold Limited’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|DRDGOLD Limited||$191.55 million||0.68||$20.05 million||N/A||N/A|
|Sibanye Gold Limited||$2.40 billion||0.47||$771.53 million||N/A||N/A|
Sibanye Gold Limited has higher revenue and earnings than DRDGOLD Limited.
This is a breakdown of recent ratings for DRDGOLD Limited and Sibanye Gold Limited, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Sibanye Gold Limited||1||3||1||0||2.00|
This table compares DRDGOLD Limited and Sibanye Gold Limited’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Sibanye Gold Limited||N/A||N/A||N/A|
Sibanye Gold Limited beats DRDGOLD Limited on 7 of the 10 factors compared between the two stocks.
About DRDGOLD Limited
DRDGOLD Limited is a gold mining company. The Company is engaged in gold production by tailings retreatment. The Company is focused on the recovery of lower-risk, higher-margin ounces primarily from its metallurgical plant located approximately 50 kilometers east of Johannesburg in Brakpan. The Company owns approximately 100% of its holding company, Ergo Mining Operations Proprietary Limited (EMO). Ergo Mining Proprietary Limited (Ergo) is owned by EMO. Ergo has a vast footprint adjacent to Johannesburg on the central and eastern Witwatersrand of South Africa. Its assets cover an area of approximately 62 kilometers from east to west and over 25 kilometers from north to south. The Ergo operation has over two metallurgical plants in operation, including Knights plant and The Ergo plant. The Knights plant in Germiston is treating the Cason dump and depositing waste on the Brakpan tailings facility (BTF). The Ergo plant has a total treatment capacity of 300,000 tons per month (tpm).
About Sibanye Gold Limited
Sibanye Gold Limited (Sibanye) is a South Africa-based mining company. The Company owns and operates gold and uranium operations, and projects throughout the Witwatersrand Basin. Its segments include Driefontein, Kloof, Beatrix, Cooke and Corporate. The Company owns and operates four underground and surface gold operations: the Cooke, Driefontein and Kloof operations in the West Witwatersrand region, and the Beatrix operation in the southern Free State province. In addition to its mining activities, Sibanye owns and manages extraction and processing facilities at the operations where the gold-bearing ore is treated. The Company has various organic projects, including the Kloof and Driefontein below infrastructure projects on the West Rand and the Burnstone project on the South Rand of Gauteng province. Sibanye mines, extracts and processes gold ore to produce a product, dore. Sibanye derives uranium ore as a by-product of gold production from the Cooke operation.
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