Buenaventura Mining (NYSE: BVN) and Sandstorm Gold (NASDAQ:SAND) are both basic materials companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, earnings, dividends, risk, profitabiliy, analyst recommendations and institutional ownership.

Insider & Institutional Ownership

48.2% of Buenaventura Mining shares are held by institutional investors. 19.3% of Buenaventura Mining shares are held by company 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 Recommendations

This is a breakdown of recent recommendations for Buenaventura Mining and Sandstorm Gold, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Buenaventura Mining 0 1 1 0 2.50
Sandstorm Gold 0 1 4 0 2.80

Buenaventura Mining currently has a consensus target price of $15.10, indicating a potential upside of 26.15%. Sandstorm Gold has a consensus target price of $6.00, indicating a potential upside of 48.51%. Given Sandstorm Gold’s stronger consensus rating and higher possible upside, analysts plainly believe Sandstorm Gold is more favorable than Buenaventura Mining.

Valuation & Earnings

This table compares Buenaventura Mining and Sandstorm Gold’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Buenaventura Mining $1.09 billion 2.79 $280.34 million ($1.44) -8.31
Sandstorm Gold $67.81 million 9.06 $43.99 million N/A N/A

Buenaventura Mining has higher revenue and earnings than Sandstorm Gold.

Profitability

This table compares Buenaventura Mining and Sandstorm Gold’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Buenaventura Mining -33.54% -11.01% -7.92%
Sandstorm Gold N/A N/A N/A

Dividends

Buenaventura Mining pays an annual dividend of $0.08 per share and has a dividend yield of 0.7%. Sandstorm Gold does not pay a dividend. Buenaventura Mining pays out -5.6% of its earnings in the form of a dividend.

Summary

Sandstorm Gold beats Buenaventura Mining on 7 of the 13 factors compared between the two stocks.

Buenaventura Mining Company Profile

Compania de Minas Buenaventura S.A.A. (Buenaventura) is a precious metals company. The Company is engaged in the exploration, mining and processing of gold, silver and other metals in Peru. The Company’s segments include Production and sale of minerals; Exploration and development activities; Construction and engineering services; Energy generation and transmission services; Insurance brokerage; Rental of mining concessions; Holding of investment in shares (mainly in Minera Yanacocha S.R.L. and S.M.R.L. Chaupiloma Dos de Cajamarca), and Industrial activities. The Company operates the Orcopampa, Uchucchacua, Julcani, Mallay and Breapampa mines and has controlling interests in over three other mining companies, which operate the Colquijirca-Marcapunta, Tantahuatay and La Zanja mines. It also owns an electric power transmission company, a hydroelectric plant, a processing plant and an engineering services consulting company and non-controlling interests in various other mining companies.

Sandstorm Gold Company Profile

Sandstorm Gold Ltd is a Canada-based company engaged in providing financing to mining companies. The Company focuses on acquiring gold and other metal purchase agreements (Gold Streams or Silver Streams), and royalties from companies that have advanced stage development projects or operating mines. The Company operates in the segments of Bachelor Lake, Black Fox, Chapada Santa Elena, Yamana Silver Stream, Chapada, Diavik Mine, Other Royalties, Other and Corporate. The Company has acquired a portfolio of approximately 140 streams and royalties, of which approximately 20 of the underlying mines are producing. The Company’s projects include Yamana Silver Stream; Cerro Moro, which is located approximately 70 kilometers southwest of the coastal port city of Puerto Deseado; Chapada Mine, which is located 270 kilometers northwest of Brasilia in Goias state, Brazil; Black Fox Mine; Santa Elena Mine; Bachelor Lake Mine; Karma Mine; Ming Mine, Bracemac-McLeod Mine and Aurizona Mine.

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