Endeavour Silver (EXK) versus Yamana Gold (AUY) Critical Analysis

Yamana Gold (NYSE: AUY) and Endeavour Silver (NYSE:EXK) are both basic materials companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, analyst recommendations, earnings, valuation, profitability, dividends and institutional ownership.

Analyst Recommendations

This is a breakdown of recent recommendations for Yamana Gold and Endeavour Silver, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Yamana Gold 0 4 7 0 2.64
Endeavour Silver 0 2 2 0 2.50

Yamana Gold currently has a consensus price target of $3.63, suggesting a potential upside of 29.00%. Endeavour Silver has a consensus price target of $6.00, suggesting a potential upside of 104.78%. Given Endeavour Silver’s higher possible upside, analysts clearly believe Endeavour Silver is more favorable than Yamana Gold.

Volatility and Risk

Yamana Gold has a beta of 0.89, indicating that its share price is 11% less volatile than the S&P 500. Comparatively, Endeavour Silver has a beta of -0.07, indicating that its share price is 107% less volatile than the S&P 500.

Valuation and Earnings

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

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Yamana Gold $1.80 billion 1.48 -$194.40 million $0.08 35.13
Endeavour Silver $150.50 million 2.48 $9.68 million $0.08 36.63

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

Profitability

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

Net Margins Return on Equity Return on Assets
Yamana Gold -18.50% 2.33% 1.19%
Endeavour Silver 3.87% 4.12% 3.33%

Institutional and Insider Ownership

43.6% of Yamana Gold shares are held by institutional investors. Comparatively, 19.3% of Endeavour Silver shares are held by institutional investors. 2.7% of Yamana Gold shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Dividends

Yamana Gold pays an annual dividend of $0.02 per share and has a dividend yield of 0.7%. Endeavour Silver does not pay a dividend. Yamana Gold pays out 25.0% of its earnings in the form of a dividend.

Summary

Endeavour Silver beats Yamana Gold on 8 of the 15 factors compared between the two stocks.

Yamana Gold Company Profile

Yamana Gold Inc. operates as a gold producer with gold production, gold development stage properties, exploration properties, and land positions throughout the Americas, including Canada, Brazil, Chile, and Argentina. It primarily sells precious metals, including gold, silver, and copper. The company was formerly known as Yamana Resources Inc. and changed its name to Yamana Gold Inc. in July 2003. Yamana Gold Inc. was founded in 1980 and is based in Toronto, Canada.

Endeavour Silver Company Profile

Endeavour Silver Corp., a mid-tier precious metals mining company, engages in the mining, evaluation, acquisition, exploration, development, extraction, processing, refining, and reclamation of silver in Mexico and Chile. The company also explores for gold deposits. It owns interests in the Guanaceví mine located in the Guanaceví district, Durango, Mexico; and the Bolañitos and El Cubo silver-gold mines located in the northern parts of the Guanajuato and La Luz silver districts in the state of Guanajuato, Mexico. The company also has interests in various exploration and development projects, including the Terronera property in Jalisco state; the El Compas property in Zacatecas State; and the Parral property located in Chihuahua State, Mexico. In addition, it holds interests in the Guadalupe y Calvo property located in Chihuahua State; and the Lourdes located in the state of Guanajuato, Mexico. The company was formerly known as Endeavour Gold Corp. and changed its name to Endeavour Silver Corp. in September 2004. Endeavour Silver Corp. was founded in 1981 and is headquartered in Vancouver, Canada.

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