Franco-Nevada Corporation (NYSE: FNV) and Gold Fields Limited (NYSE:GFI) are both mid-cap basic materials companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, risk, dividends, valuation, analyst recommendations, profitabiliy and earnings.

Institutional & Insider Ownership

63.5% of Franco-Nevada Corporation shares are held by institutional investors. Comparatively, 35.1% of Gold Fields Limited shares are held by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Dividends

Franco-Nevada Corporation pays an annual dividend of $0.92 per share and has a dividend yield of 1.3%. Gold Fields Limited pays an annual dividend of $0.07 per share and has a dividend yield of 1.7%. Franco-Nevada Corporation pays out 121.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Franco-Nevada Corporation has raised its dividend for 4 consecutive years.

Valuation and Earnings

This table compares Franco-Nevada Corporation and Gold Fields Limited’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Franco-Nevada Corporation $650.10 million 20.21 $508.00 million $0.76 95.66
Gold Fields Limited $2.75 billion 1.20 $1.17 billion N/A N/A

Gold Fields Limited has higher revenue and earnings than Franco-Nevada Corporation.

Risk and Volatility

Franco-Nevada Corporation has a beta of -0.03, meaning that its stock price is 103% less volatile than the S&P 500. Comparatively, Gold Fields Limited has a beta of -1.03, meaning that its stock price is 203% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Franco-Nevada Corporation and Gold Fields Limited, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Franco-Nevada Corporation 0 8 8 0 2.50
Gold Fields Limited 3 1 2 0 1.83

Franco-Nevada Corporation currently has a consensus target price of $78.55, suggesting a potential upside of 8.04%. Gold Fields Limited has a consensus target price of $3.41, suggesting a potential downside of 14.96%. Given Franco-Nevada Corporation’s stronger consensus rating and higher possible upside, equities analysts clearly believe Franco-Nevada Corporation is more favorable than Gold Fields Limited.

Profitability

This table compares Franco-Nevada Corporation and Gold Fields Limited’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Franco-Nevada Corporation 21.17% 4.35% 4.28%
Gold Fields Limited N/A N/A N/A

Summary

Franco-Nevada Corporation beats Gold Fields Limited on 11 of the 15 factors compared between the two stocks.

Franco-Nevada Corporation Company Profile

Franco-Nevada Corporation (Franco-Nevada) is a gold-focused royalty and stream company. The Company has interests in silver, platinum group metals, oil and gas and other resource assets. The Company is engaged in resource sector royalty/stream acquisitions and management activities. It has a portfolio of properties in the United States, Canada, Mexico, Peru, Chile and Africa. Its properties in the United States include Goldstrike, Stillwater, Gold Quarry, Marigold, Fire Creek/Midas, Bald Mountain, South Arturo and Other. Its properties in Canada include Sudbury, Detour Lake, Golden Highway, Musselwhite, Hemlo, Kirkland Lake, Timmins West, Canadian Malartic and Other. Its properties in Latin America include Antapaccay, Antamina, Candelaria, Guadalupe-Palmarejo and Other. Its properties in Rest of World include Mine Waste Solutions (MWS), Sabodala, Subika, Tasiast, Karma, Duketon, Edikan and Other.

Gold Fields Limited Company Profile

Gold Fields Limited (Gold Fields) is a gold mining company. The Company is a producer of gold and a holder of gold reserves. The Company is involved in underground and surface gold and copper mining and related activities, including exploration, development, extraction, processing and smelting. It has approximately eight producing mines located in South Africa, Ghana, Australia and Peru. It operates through four segments: South Africa, Ghana, Australia and Peru. Its South African operation is South Deep. Gold Fields also owns the St. Ives mine, the Agnew mine and the Yilgarn South Assets in Australia, and has an interest in each of the Tarkwa gold mine and the Damang gold mine in Ghana. Gold Fields also owns an economic interest in the Cerro Corona mine. In Peru, Gold Fields also produces copper. In addition, Gold Fields has gold and other precious metal exploration activities and interests in Africa, Eurasia, Australasia and the Americas.

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