Contrasting Royal Gold (NASDAQ:RGLD) and Pelangio Exploration (OTCMKTS:PGXPF)

Pelangio Exploration (OTCMKTS:PGXPF) and Royal Gold (NASDAQ:RGLD) are both basic materials companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, dividends, institutional ownership, analyst recommendations, valuation, earnings and risk.

Insider and Institutional Ownership

83.7% of Royal Gold shares are owned by institutional investors. 0.5% of Royal Gold shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Pelangio Exploration and Royal Gold, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Pelangio Exploration	0	0	0	0	0.00
Royal Gold	1	2	8	0	2.64

Royal Gold has a consensus target price of $234.60, suggesting a potential downside of 9.47%. Given Royal Gold’s stronger consensus rating and higher probable upside, analysts plainly believe Royal Gold is more favorable than Pelangio Exploration.

Valuation and Earnings

This table compares Pelangio Exploration and Royal Gold”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Pelangio Exploration	N/A	N/A	-$550,000.00	N/A	N/A
Royal Gold	$719.40 million	30.40	$332.02 million	$7.28	35.60

Royal Gold has higher revenue and earnings than Pelangio Exploration.

Profitability

This table compares Pelangio Exploration and Royal Gold’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Pelangio Exploration	N/A	-778.64%	-87.35%
Royal Gold	55.99%	14.14%	12.42%

Volatility & Risk

Pelangio Exploration has a beta of 0.01, indicating that its stock price is 99% less volatile than the S&P 500. Comparatively, Royal Gold has a beta of 0.49, indicating that its stock price is 51% less volatile than the S&P 500.

Summary

Royal Gold beats Pelangio Exploration on 11 of the 11 factors compared between the two stocks.

About Pelangio Exploration

Pelangio Exploration Inc., a mineral exploration company, engages in acquiring, exploring, and developing mineral properties. It holds interests in various gold properties in Ghana and Canada. The company was incorporated in 2008 and is headquartered in Toronto, Canada.

About Royal Gold

Royal Gold, Inc., together with its subsidiaries, acquires and manages precious metal streams, royalties, and related interests. The company engages in acquiring stream and royalty interests or to finance projects that are in production, development, or in the exploration stage in exchange for stream or royalty interests, which primarily consists of gold, silver, copper, nickel, zinc, lead, and other metals. Its stream and royalty interests on properties are located in the United States, Canada, Chile, the Dominican Republic, Australia, Africa, Mexico, Botswana, and internationally. Royal Gold, Inc. was incorporated in 1981 and is headquartered in Denver, Colorado.