Turquoise Hill Resources (NYSE: IVN) and BHP Billiton Limited (NYSE:BHP) are both basic materials companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, profitabiliy, institutional ownership, valuation, dividends, analyst recommendations and risk.

Institutional and Insider Ownership

3.0% of BHP Billiton Limited shares are owned by institutional investors. 0.0% of BHP Billiton Limited shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Turquoise Hill Resources and BHP Billiton Limited’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Turquoise Hill Resources N/A N/A N/A N/A N/A
BHP Billiton Limited $34.69 billion 3.16 $15.48 billion N/A N/A

BHP Billiton Limited has higher revenue and earnings than Turquoise Hill Resources.

Profitability

This table compares Turquoise Hill Resources and BHP Billiton Limited’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Turquoise Hill Resources 12.51% 1.88% 0.95%
BHP Billiton Limited N/A N/A N/A

Analyst Recommendations

This is a breakdown of recent ratings for Turquoise Hill Resources and BHP Billiton Limited, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Turquoise Hill Resources 0 0 0 0 N/A
BHP Billiton Limited 1 7 7 0 2.40

BHP Billiton Limited has a consensus target price of $34.11, indicating a potential downside of 17.23%. Given BHP Billiton Limited’s higher probable upside, analysts plainly believe BHP Billiton Limited is more favorable than Turquoise Hill Resources.

Dividends

BHP Billiton Limited pays an annual dividend of $1.60 per share and has a dividend yield of 3.9%. Turquoise Hill Resources does not pay a dividend.

Summary

BHP Billiton Limited beats Turquoise Hill Resources on 6 of the 9 factors compared between the two stocks.

About Turquoise Hill Resources

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).

About BHP Billiton Limited

BHP Billiton Limited is a global resources company. The Company is a producer of various commodities, including iron ore, metallurgical coal, copper and uranium. Its segments include Petroleum, Copper, Iron Ore and Coal. The Petroleum segment is engaged in the exploration, development and production of oil and gas. The Copper segment is engaged in mining of copper, silver, lead, zinc, molybdenum, uranium and gold. The Iron Ore segment is engaged in mining of iron ore. The Coal segment is engaged in mining of metallurgical coal and thermal (energy) coal. Its businesses include Minerals Australia, Minerals Americas, Petroleum and Marketing. The Company extracts and processes minerals, oil and gas from its production operations located primarily in Australia and the Americas. The Company manages product distribution through its global logistics chain, including freight and pipeline transportation. Its businesses include Minerals Australia, Minerals Americas, Petroleum and Marketing.

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