Financial Analysis: Cleveland-Cliffs (NYSE:CLF) versus Triple Flag Precious Metals (NYSE:TFPM)

Triple Flag Precious Metals (NYSE:TFPM) and Cleveland-Cliffs (NYSE:CLF) are both mid-cap materials companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, profitability, institutional ownership, analyst recommendations, risk, earnings and dividends.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Triple Flag Precious Metals and Cleveland-Cliffs, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Triple Flag Precious Metals	0	4	5	0	2.56
Cleveland-Cliffs	1	8	3	0	2.17

Triple Flag Precious Metals currently has a consensus price target of $39.25, indicating a potential upside of 26.37%. Cleveland-Cliffs has a consensus price target of $14.60, indicating a potential upside of 14.74%. Given Triple Flag Precious Metals’ stronger consensus rating and higher probable upside, research analysts clearly believe Triple Flag Precious Metals is more favorable than Cleveland-Cliffs.

Earnings & Valuation

This table compares Triple Flag Precious Metals and Cleveland-Cliffs”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Triple Flag Precious Metals	$388.70 million	16.44	$240.01 million	$2.00	15.53
Cleveland-Cliffs	$18.61 billion	0.39	-$1.48 billion	($0.85)	-14.97

Triple Flag Precious Metals has higher earnings, but lower revenue than Cleveland-Cliffs. Cleveland-Cliffs is trading at a lower price-to-earnings ratio than Triple Flag Precious Metals, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Triple Flag Precious Metals and Cleveland-Cliffs’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Triple Flag Precious Metals	82.56%	13.56%	12.81%
Cleveland-Cliffs	-2.36%	-6.83%	-2.05%

Institutional and Insider Ownership

82.9% of Triple Flag Precious Metals shares are held by institutional investors. Comparatively, 67.7% of Cleveland-Cliffs shares are held by institutional investors. 0.9% of Cleveland-Cliffs shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Risk & Volatility

Triple Flag Precious Metals has a beta of -0.09, suggesting that its stock price is 109% less volatile than the S&P 500. Comparatively, Cleveland-Cliffs has a beta of 1.99, suggesting that its stock price is 99% more volatile than the S&P 500.

Summary

Triple Flag Precious Metals beats Cleveland-Cliffs on 11 of the 14 factors compared between the two stocks.

About Triple Flag Precious Metals

Triple Flag Precious Metals Corp. is a precious metals streaming and royalty company. It provides mining companies with upfront financing in exchange for the right to purchase a portion of future metal production or receive royalty payments tied to production or revenue. The company’s portfolio is focused on gold and silver, with exposure to other metals through some assets. Triple Flag holds interests in mines and development projects across several regions, including the Americas, Australia and Africa.

About Cleveland-Cliffs

Cleveland-Cliffs Inc. is a vertically integrated steel and iron ore company headquartered in Cleveland, Ohio. Its operations span iron ore mining and pellet production, direct-reduced iron and coke production, and steelmaking and finishing. The company makes flat-rolled steel products, including hot-rolled, cold-rolled and coated steel, as well as plate and other specialty products. Its customers serve industries such as automotive, infrastructure, manufacturing and appliances. Founded in 1847 as an iron ore mining company, Cleveland-Cliffs expanded into steelmaking and has built an integrated production network across the United States and Canada.