First Majestic Silver (NYSE:AG) & POSCO (NYSE:PKX) Critical Contrast

First Majestic Silver (NYSE:AG) and POSCO (NYSE:PKX) are both materials companies, but which is the superior stock? We will contrast the two companies based on the strength of their dividends, earnings, valuation, risk, profitability, institutional ownership and analyst recommendations.

Institutional & Insider Ownership

27.2% of First Majestic Silver shares are held by institutional investors. 0.9% of First Majestic Silver shares are held by insiders. Comparatively, 0.0% of POSCO shares are held 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.

Profitability

This table compares First Majestic Silver and POSCO’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Majestic Silver	21.18%	13.36%	9.20%
POSCO	1.79%	2.00%	1.19%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for First Majestic Silver and POSCO, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Majestic Silver	0	3	5	1	2.78
POSCO	0	1	1	1	3.00

First Majestic Silver presently has a consensus price target of $23.83, suggesting a potential upside of 25.55%. Given First Majestic Silver’s higher probable upside, research analysts plainly believe First Majestic Silver is more favorable than POSCO.

Volatility & Risk

First Majestic Silver has a beta of 0.94, suggesting that its stock price is 6% less volatile than the S&P 500. Comparatively, POSCO has a beta of 1.56, suggesting that its stock price is 56% more volatile than the S&P 500.

Dividends

First Majestic Silver pays an annual dividend of $0.07 per share and has a dividend yield of 0.4%. POSCO pays an annual dividend of $1.00 per share and has a dividend yield of 1.8%. First Majestic Silver pays out 9.9% of its earnings in the form of a dividend. POSCO pays out 37.9% 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.

Earnings and Valuation

This table compares First Majestic Silver and POSCO”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Majestic Silver	$1.26 billion	7.44	$164.92 million	$0.71	26.74
POSCO	$48.64 billion	0.35	$483.48 million	$2.64	21.61

POSCO has higher revenue and earnings than First Majestic Silver. POSCO is trading at a lower price-to-earnings ratio than First Majestic Silver, indicating that it is currently the more affordable of the two stocks.

Summary

First Majestic Silver beats POSCO on 10 of the 16 factors compared between the two stocks.

About First Majestic Silver

First Majestic Silver Corp. engages in the acquisition, exploration, development, and production of mineral properties with a focus on silver and gold production in North America. Its projects include the San Dimas mine covering an area of approximately 71,867 hectares located in Durango State, Mexico; the Santa Elena that covers an area of approximately 102,244 hectares located in Sonora State, México; and the La Encantada covering an area of approximately 4,076 hectares located in Coahuila State, México. The company was formerly known as First Majestic Resource Corp. and changed its name to First Majestic Silver Corp. in November 2006. First Majestic Silver Corp. was incorporated in 1979 and is headquartered in Vancouver, Canada.

About POSCO

POSCO Holdings Inc., together with its subsidiaries, operates as an integrated steel producer in Korea and internationally. It operates through six segments: Steel, Trading, Construction, Logistics and Others, Green Materials and Energy, and Others. The company engages in the production, import, sale, and export of steel products, such as hot and cold rolled steel, stainless steel, plates, wire rods, and silicon steel sheets, as well as pig iron, billets, blooms, and slabs; trading of steel and raw materials, textiles, agricultural commodities, and other goods; natural resources development and power generation activities; and planning, designing, and construction of industrial plants, civil engineering projects, and commercial and residential buildings. It is also involved in the manufacture and sale of various energy-related and other industrial materials, including anode and cathode materials for rechargeable batteries; investment business; and provision of alternative environmentally-friendly energy solutions, as well as information technology and operational technology, and integrated logistics services. POSCO Holdings Inc. was incorporated in 1968 and is based in Seoul, South Korea.