Barrick Gold Corporation (NYSE: ABX) and Agnico Eagle Mines Limited (NYSE:AEM) are both large-cap basic materials companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, profitability, dividends, valuation, analyst recommendations, risk and earnings.

Institutional and Insider Ownership

58.7% of Barrick Gold Corporation shares are held by institutional investors. Comparatively, 60.3% of Agnico Eagle Mines Limited shares are held by institutional investors. 0.5% of Agnico Eagle Mines Limited shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Dividends

Barrick Gold Corporation pays an annual dividend of $0.12 per share and has a dividend yield of 0.7%. Agnico Eagle Mines Limited pays an annual dividend of $0.40 per share and has a dividend yield of 0.8%. Barrick Gold Corporation pays out 5.9% of its earnings in the form of a dividend. Agnico Eagle Mines Limited pays out 36.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Barrick Gold Corporation has raised its dividend for 5 consecutive years.

Profitability

This table compares Barrick Gold Corporation and Agnico Eagle Mines Limited’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Barrick Gold Corporation 26.95% 8.91% 3.71%
Agnico Eagle Mines Limited 11.32% 5.38% 3.40%

Earnings and Valuation

This table compares Barrick Gold Corporation and Agnico Eagle Mines Limited’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Barrick Gold Corporation $8.77 billion 2.28 $4.42 billion $2.02 8.49
Agnico Eagle Mines Limited $2.21 billion 4.97 $932.83 million $1.09 43.55

Barrick Gold Corporation has higher revenue and earnings than Agnico Eagle Mines Limited. Barrick Gold Corporation is trading at a lower price-to-earnings ratio than Agnico Eagle Mines Limited, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Barrick Gold Corporation and Agnico Eagle Mines Limited, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Barrick Gold Corporation 0 8 6 0 2.43
Agnico Eagle Mines Limited 1 3 6 0 2.50

Barrick Gold Corporation presently has a consensus target price of $20.72, indicating a potential upside of 20.88%. Agnico Eagle Mines Limited has a consensus target price of $55.50, indicating a potential upside of 16.92%. Given Barrick Gold Corporation’s higher possible upside, research analysts plainly believe Barrick Gold Corporation is more favorable than Agnico Eagle Mines Limited.

Volatility & Risk

Barrick Gold Corporation has a beta of -0.23, indicating that its stock price is 123% less volatile than the S&P 500. Comparatively, Agnico Eagle Mines Limited has a beta of -0.67, indicating that its stock price is 167% less volatile than the S&P 500.

Summary

Barrick Gold Corporation beats Agnico Eagle Mines Limited on 10 of the 16 factors compared between the two stocks.

About Barrick Gold Corporation

Barrick Gold Corporation (Barrick) is a gold mining company. The Company is principally engaged in the production and sale of gold and copper, as well as related activities, such as exploration and mine development. The Company’s segments include Goldstrike, Cortez, Pueblo Viejo, Lagunas Norte, Veladero, Turquoise Ridge, Acacia Mining plc (Acacia), Pascua-Lama and Other Mines. Goldstrike, Cortez, Pueblo Viejo, Lagunas Norte, Veladero and Turquoise Ridge are its individual gold mines. The Company, through its subsidiary, Acacia, owns gold mines and exploration properties in Africa. It also holds interest in gold mines, including Porgera and Kalgoorlie, and copper mines, such as Zaldivar and Lumwana. The Pascua-Lama project is located on the border between Chile and Argentina. The Company has nine producing gold mines, which are located in Canada, the United States, Peru, Argentina, Australia and the Dominican Republic.

About Agnico Eagle Mines Limited

Agnico Eagle Mines Limited is a gold producer with mining operations in northwestern Quebec, northern Mexico, northern Finland and Nunavut and exploration activities in Canada, Europe, Latin America and the United States. The Company operates through three business units. The Northern Business consists of its operations in Canada and Finland. The Company’s Canadian properties include the LaRonde mine, the Lapa mine, the Goldex mine, the Meadowbank mine and the Meliadine project, and Canadian Malartic Mine. The operations in Finland include the Kittila mine. The Southern Business consists of its operations in Mexico. Its Pinos Altos mine includes the Creston Mascota deposit. The La India mine is owned by its indirect subsidiary. Its Exploration group focuses on the identification of new mineral reserves and mineral resources, and new development opportunities in gold producing regions. Its exploration activities are concentrated in Canada, Europe, Latin America and the United States.

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