Turquoise Hill Resources (NYSE: TRQ) and Rio Tinto PLC (NYSE:RIO) are both mid-cap integrated mining companies, but which is the better business? We will contrast the two companies based on the strength of their dividends, analyst recommendations, earnings, institutional ownership, profitability, valuation and risk.

Volatility & Risk

Turquoise Hill Resources has a beta of 0.33, suggesting that its stock price is 67% less volatile than the S&P 500. Comparatively, Rio Tinto PLC has a beta of 1.02, suggesting that its stock price is 2% more volatile than the S&P 500.

Valuation and Earnings

This table compares Turquoise Hill Resources and Rio Tinto PLC’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Turquoise Hill Resources $1.20 billion 5.13 $210.60 million $0.11 27.91
Rio Tinto PLC $33.78 billion 1.92 $4.62 billion $3.43 13.87

Rio Tinto PLC has higher revenue and earnings than Turquoise Hill Resources. Rio Tinto PLC is trading at a lower price-to-earnings ratio than Turquoise Hill Resources, indicating that it is currently the more affordable of the two stocks.

Dividends

Rio Tinto PLC pays an annual dividend of $2.37 per share and has a dividend yield of 5.0%. Turquoise Hill Resources does not pay a dividend. Rio Tinto PLC pays out 69.1% of its earnings in the form of a dividend.

Profitability

This table compares Turquoise Hill Resources and Rio Tinto PLC’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Turquoise Hill Resources 24.48% 2.81% 1.77%
Rio Tinto PLC N/A N/A N/A

Institutional & Insider Ownership

33.0% of Turquoise Hill Resources shares are held by institutional investors. Comparatively, 7.0% of Rio Tinto PLC shares are held by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Turquoise Hill Resources and Rio Tinto PLC, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Turquoise Hill Resources 0 2 2 0 2.50
Rio Tinto PLC 1 7 10 0 2.50

Turquoise Hill Resources currently has a consensus price target of $4.75, suggesting a potential upside of 54.72%. Rio Tinto PLC has a consensus price target of $48.59, suggesting a potential upside of 2.11%. Given Turquoise Hill Resources’ higher probable upside, equities analysts plainly believe Turquoise Hill Resources is more favorable than Rio Tinto PLC.

Summary

Turquoise Hill Resources beats Rio Tinto PLC on 7 of the 13 factors compared between the two stocks.

Turquoise Hill Resources Company Profile

Turquoise Hill Resources Ltd. is an international mining company. The Company focuses on the operation and further development of the Oyu Tolgoi copper-gold mine in Southern Mongolia, which is the Company’s principal material mineral resource property. The Company’s Oyu Tolgoi mine is held through approximately 65% interest in Oyu Tolgoi LLC (Oyu Tolgoi) and the remaining approximately 35% interest is held by Erdenes Oyu Tolgoi LLC (Erdenes). The Company’s Oyu Tolgoi mine is located approximately 550 kilometers south of Ulaanbaatar, Mongolia’s capital city, and 80 kilometers north of the Mongolia-China border. The Company’s Mineralization on the property consists of porphyry-style copper, gold, silver and molybdenum contained in a linear structural trend (the Oyu Tolgoi Trend) of deposits throughout this trend. They include, from south to north, the Heruga Deposit, the Oyut deposit and the Hugo Dummett deposits (Hugo South, Hugo North and Hugo North Extension).

Rio Tinto PLC Company Profile

Rio Tinto plc is a mining and metals company. The Company’s business is finding, mining and processing mineral resources. The Company’s segments include Iron Ore, Aluminium, Copper & Diamonds, Energy & Minerals and Other Operations. The Company operates an iron ore business, supplying the global seaborne iron ore trade. Its Iron Ore product operations are located in the Pilbara region of Western Australia. The Aluminium business includes bauxite mines, alumina refineries and aluminum smelters. Its bauxite mines are located in Australia, Brazil and Guinea. The Copper & Diamonds segment has managed operations in Australia, Canada, Mongolia and the United States, and non-managed operations in Chile and Indonesia. The Energy & Minerals segment consists of mining, refining and marketing operations in over 10 countries, across six sectors: borates, coal, iron ore concentrate and pellets, salt, titanium dioxide and uranium.

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