Newmont Mining (NEM) vs. Endeavour Silver (EXK) Financial Analysis

Newmont Mining (NYSE: NEM) and Endeavour Silver (NYSE:EXK) are both basic materials companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, earnings, profitability, institutional ownership, risk, valuation and analyst recommendations.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Newmont Mining and Endeavour Silver, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Newmont Mining 1 6 6 0 2.38
Endeavour Silver 0 2 2 0 2.50

Newmont Mining presently has a consensus target price of $43.08, indicating a potential upside of 14.25%. Endeavour Silver has a consensus target price of $6.00, indicating a potential upside of 92.31%. Given Endeavour Silver’s stronger consensus rating and higher probable upside, analysts clearly believe Endeavour Silver is more favorable than Newmont Mining.

Earnings and Valuation

This table compares Newmont Mining and Endeavour Silver’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Newmont Mining $7.35 billion 2.74 -$98.00 million $1.46 25.83
Endeavour Silver $150.50 million 2.64 $9.68 million $0.08 39.00

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

Insider & Institutional Ownership

82.3% of Newmont Mining shares are held by institutional investors. Comparatively, 19.5% of Endeavour Silver shares are held by institutional investors. 0.4% of Newmont Mining shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Dividends

Newmont Mining pays an annual dividend of $0.56 per share and has a dividend yield of 1.5%. Endeavour Silver does not pay a dividend. Newmont Mining pays out 38.4% of its earnings in the form of a dividend. Newmont Mining has raised its dividend for 2 consecutive years.

Risk & Volatility

Newmont Mining has a beta of 0.28, meaning that its stock price is 72% less volatile than the S&P 500. Comparatively, Endeavour Silver has a beta of -0.04, meaning that its stock price is 104% less volatile than the S&P 500.

Profitability

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

Net Margins Return on Equity Return on Assets
Newmont Mining 0.64% 7.01% 4.01%
Endeavour Silver 3.87% 4.12% 3.33%

Summary

Newmont Mining beats Endeavour Silver on 11 of the 17 factors compared between the two stocks.

About Newmont Mining

Newmont Mining Corporation, together with its subsidiaries, operates in the mining industry. The company primarily acquires, develops, explores for, and produces gold, copper, and silver. Its operations and/or assets are located in the United States, Australia, Peru, Ghana, and Suriname. As of February 22, 2018, the company had proven and probable gold reserves of 68.5 million ounces and an aggregate land position of approximately 23,000 square miles. Newmont Mining Corporation was founded in 1916 and is headquartered in Greenwood Village, Colorado.

About Endeavour Silver

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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