Head to Head Contrast: BHP Billiton (BBL) vs. Yamana Gold (AUY)

Yamana Gold (NYSE: AUY) and BHP Billiton (NYSE:BBL) are both mid-cap basic materials companies, but which is the better investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, valuation, analyst recommendations, dividends, earnings and profitability.

Profitability

This table compares Yamana Gold and BHP Billiton’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Yamana Gold -20.19% 0.71% 0.37%
BHP Billiton N/A N/A N/A

Analyst Ratings

This is a summary of current ratings and recommmendations for Yamana Gold and BHP Billiton, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Yamana Gold 1 6 2 0 2.11
BHP Billiton 1 1 1 0 2.00

Yamana Gold currently has a consensus price target of $3.54, indicating a potential upside of 37.65%. BHP Billiton has a consensus price target of $38.00, indicating a potential upside of 3.54%. Given Yamana Gold’s stronger consensus rating and higher possible upside, research analysts plainly believe Yamana Gold is more favorable than BHP Billiton.

Insider & Institutional Ownership

40.6% of Yamana Gold shares are owned by institutional investors. Comparatively, 4.4% of BHP Billiton shares are owned by institutional investors. 2.7% of Yamana Gold shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Yamana Gold and BHP Billiton’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Yamana Gold $1.79 billion 1.36 -$307.90 million ($0.37) -6.95
BHP Billiton $38.29 billion 1.01 $5.89 billion $2.21 16.61

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

Dividends

Yamana Gold pays an annual dividend of $0.02 per share and has a dividend yield of 0.8%. BHP Billiton pays an annual dividend of $1.66 per share and has a dividend yield of 4.5%. Yamana Gold pays out -5.4% of its earnings in the form of a dividend. BHP Billiton pays out 75.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Risk and Volatility

Yamana Gold has a beta of 0.64, indicating that its share price is 36% less volatile than the S&P 500. Comparatively, BHP Billiton has a beta of 1.04, indicating that its share price is 4% more volatile than the S&P 500.

Summary

Yamana Gold beats BHP Billiton on 9 of the 15 factors compared between the two stocks.

Yamana Gold Company Profile

Yamana Gold Inc. is a gold producer with gold production, gold development stage properties, exploration properties, and land positions throughout the Americas, including Canada, Brazil, Chile and Argentina. The Company’s segments include Chapada mine in Brazil; El Penon mine in Chile; Canadian Malartic mine in Canada; Gualcamayo mine in Argentina; Minera Florida mine in Chile; Jacobina mine in Brazil; Brio Gold Inc. (Brio Gold), and Corporate and other. The Company’s development projects include Cerro Moro, Argentina; Agua Rica, Argentina, and Gualcamayo, Argentina. Its exploration projects include Chapada, Brazil; El Penon, Chile; Gualcamayo, Argentina; Minera Florida, Chile; Jacobina, Brazil; Cerro Moro, Argentina; Canadian Malartic Corporation, Canada; Monument Bay, Canada; Brio Gold Exploration; Pilar, Brazil; Fazenda Brasileiro, Brazil; RDM, Brazil, and C1 Santa Luz, Brazil.

BHP Billiton Company Profile

BHP Billiton Plc is a global resources company. The Company is a producer of various commodities, including iron ore, metallurgical coal, copper and uranium. Its segments include Petroleum, Copper, Iron Ore and Coal. The Petroleum segment is engaged in the exploration, development and production of oil and gas. The Copper segment is engaged in mining of copper, silver, lead, zinc, molybdenum, uranium and gold. The Iron Ore segment is engaged in mining of iron ore. The Coal segment is engaged in mining of metallurgical coal and thermal (energy) coal. Its businesses include Minerals Australia, Minerals Americas, Petroleum and Marketing. It extracts and processes minerals, oil and gas from its production operations located primarily in Australia and the Americas. It manages product distribution through its global logistics chain, including freight and pipeline transportation. It sells its products through direct supply agreements with its customers and on global commodity exchanges.

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