Critical Contrast: Mesabi Trust (NYSE:MSB) & Eldorado Gold (NYSE:EGO)

Eldorado Gold (NYSE:EGO) and Mesabi Trust (NYSE:MSB) are both materials companies, but which is the better business? We will compare the two businesses based on the strength of their earnings, analyst recommendations, dividends, institutional ownership, valuation, profitability and risk.

Institutional & Insider Ownership

69.6% of Eldorado Gold shares are held by institutional investors. 0.6% of Eldorado Gold shares are held by company insiders. Comparatively, 0.3% of Mesabi Trust shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Eldorado Gold and Mesabi Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Eldorado Gold	29.83%	10.91%	7.07%
Mesabi Trust	54.46%	33.50%	28.16%

Analyst Ratings

This is a summary of recent recommendations and price targets for Eldorado Gold and Mesabi Trust, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eldorado Gold	0	7	6	2	2.67
Mesabi Trust	0	1	0	0	2.00

Eldorado Gold presently has a consensus price target of $46.57, indicating a potential upside of 29.61%. Given Eldorado Gold’s stronger consensus rating and higher possible upside, analysts plainly believe Eldorado Gold is more favorable than Mesabi Trust.

Valuation and Earnings

This table compares Eldorado Gold and Mesabi Trust”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eldorado Gold	$1.82 billion	5.17	$507.26 million	$2.82	12.74
Mesabi Trust	$17.52 million	13.46	$13.87 million	$0.49	36.68

Eldorado Gold has higher revenue and earnings than Mesabi Trust. Eldorado Gold is trading at a lower price-to-earnings ratio than Mesabi Trust, indicating that it is currently the more affordable of the two stocks.

Dividends

Eldorado Gold pays an annual dividend of $0.30 per share and has a dividend yield of 0.8%. Mesabi Trust pays an annual dividend of $0.20 per share and has a dividend yield of 1.1%. Eldorado Gold pays out 10.6% of its earnings in the form of a dividend. Mesabi Trust pays out 40.8% 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.

Volatility & Risk

Eldorado Gold has a beta of 0.67, meaning that its share price is 33% less volatile than the S&P 500. Comparatively, Mesabi Trust has a beta of 0.32, meaning that its share price is 68% less volatile than the S&P 500.

Summary

Eldorado Gold beats Mesabi Trust on 11 of the 17 factors compared between the two stocks.

About Eldorado Gold

Eldorado Gold Corporation, together with its subsidiaries, engages in the mining, exploration, development, and sale of mineral products primarily in Turkey, Canada, Greece, and Romania. The company primarily produces gold, as well as silver, lead, and zinc. It holds a 100% interest in the Kisladag and Efemçukuru mines located in Turkey; Lamaque complex located in Canada; and Olympias, Stratoni, Skouries, Perama Hill, and Sapes gold mines located in Greece, as well as the 80.5% interest in Certej development projects located in Romania. The company was formerly known as Eldorado Corporation Ltd. and changed its name to Eldorado Gold Corporation in April 1996. Eldorado Gold Corporation was incorporated in 1996 and is headquartered in Vancouver, Canada.

About Mesabi Trust

Mesabi Trust, a royalty trust, engages in iron ore mining business in the United States. Mesabi Trust was founded in 1961 and is based in New York, New York.