Royal Gold (NASDAQ: RGLD) and SSR Mining (NASDAQ:SSRM) are both basic materials companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, dividends, profitability, earnings, analyst recommendations, risk and valuation.
This table compares Royal Gold and SSR Mining’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This table compares Royal Gold and SSR Mining’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Royal Gold||$440.81 million||12.80||$101.53 million||$1.55||55.60|
|SSR Mining||$448.77 million||2.58||$69.31 million||$0.34||28.41|
Royal Gold has higher earnings, but lower revenue than SSR Mining. SSR Mining is trading at a lower price-to-earnings ratio than Royal Gold, indicating that it is currently the more affordable of the two stocks.
Royal Gold pays an annual dividend of $1.00 per share and has a dividend yield of 1.2%. SSR Mining does not pay a dividend. Royal Gold pays out 64.5% of its earnings in the form of a dividend. Royal Gold has raised its dividend for 13 consecutive years.
This is a summary of current recommendations and price targets for Royal Gold and SSR Mining, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Royal Gold presently has a consensus target price of $95.23, suggesting a potential upside of 10.50%. SSR Mining has a consensus target price of $12.83, suggesting a potential upside of 32.85%. Given SSR Mining’s stronger consensus rating and higher probable upside, analysts clearly believe SSR Mining is more favorable than Royal Gold.
Volatility and Risk
Royal Gold has a beta of 0.61, indicating that its stock price is 39% less volatile than the S&P 500. Comparatively, SSR Mining has a beta of -0.23, indicating that its stock price is 123% less volatile than the S&P 500.
Insider & Institutional Ownership
77.7% of Royal Gold shares are owned by institutional investors. Comparatively, 47.2% of SSR Mining shares are owned by institutional investors. 1.1% of Royal Gold shares are owned 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.
Royal Gold beats SSR Mining on 12 of the 17 factors compared between the two stocks.
Royal Gold Company Profile
Royal Gold, Inc., together with its subsidiaries, acquires and manages precious metal streams, royalties, and similar interests. It focuses on acquiring stream and royalty interests or to finance projects that are in production or in development stage in exchange for stream or royalty interests. As of June 30, 2017, the company owned stream interests in 4 producing property and 2 development stage properties; and owned royalty interests in 35 producing properties, 18 development stage properties, and 135 exploration stage properties. Its principal producing stream and royalty interests on properties are located in the United States, Canada, Chile, the Dominican Republic, Ghana, and Mexico. The company also holds stream and royalty interests in mines and projects in other countries, including Argentina, Australia, Bolivia, Brazil, Burkina Faso, Guatemala, Honduras, Macedonia, Nicaragua, Peru, Russia, Spain, and Tunisia. Royal Gold, Inc. was founded in 1981 and is based in Denver, Colorado.
SSR Mining Company Profile
SSR Mining Inc, formerly Silver Standard Resources Inc, is a Canada-based resource company. The Company is engaged in the operation, acquisition, exploration and development of precious metal resource properties located in the Americas. The Company’s segments include Pirquitas mine, Marigold mine, Seabee Gold Operation, and Exploration and evaluation properties. The Company has three producing mines and a portfolio of silver resource dominant projects located throughout the Americas. The Company is focused on silver production from the Pirquitas mine in Argentina and gold production from the Marigold mine in Nevada, the United States. The Company’s other projects include Seabee Gold Operation in Saskatchewan, Canada and Pirquitas mine in Jujuy, Argentina. The Marigold mine produced approximately 205,116 ounces of gold. The Seabee Gold Operation produced approximately 77,640 ounces of gold. The Pirquitas mine produced approximately 10.4 million ounces of silver.
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