Iamgold Corporation (NYSE: IAG) and Agnico Eagle Mines Limited (NYSE:AEM) are both mid-cap basic materials companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, earnings, analyst recommendations, dividends, institutional ownership, valuation and risk.

Profitability

This table compares Iamgold Corporation and Agnico Eagle Mines Limited’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Iamgold Corporation 46.75% 1.43% 0.95%
Agnico Eagle Mines Limited 11.32% 5.38% 3.40%

Dividends

Agnico Eagle Mines Limited pays an annual dividend of $0.40 per share and has a dividend yield of 0.9%. Iamgold Corporation does not pay a dividend. Agnico Eagle Mines Limited pays out 36.7% of its earnings in the form of a dividend. Agnico Eagle Mines Limited has increased its dividend for 5 consecutive years.

Volatility & Risk

Iamgold Corporation has a beta of -0.31, meaning that its stock price is 131% less volatile than the S&P 500. Comparatively, Agnico Eagle Mines Limited has a beta of -0.67, meaning that its stock price is 167% less volatile than the S&P 500.

Valuation & Earnings

This table compares Iamgold Corporation and Agnico Eagle Mines Limited’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Iamgold Corporation $1.07 billion 2.46 $857.40 million $1.07 5.30
Agnico Eagle Mines Limited $2.21 billion 4.92 $932.83 million $1.09 43.16

Agnico Eagle Mines Limited has higher revenue and earnings than Iamgold Corporation. Iamgold Corporation is trading at a lower price-to-earnings ratio than Agnico Eagle Mines Limited, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings for Iamgold Corporation and Agnico Eagle Mines Limited, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Iamgold Corporation 0 6 2 0 2.25
Agnico Eagle Mines Limited 1 3 6 0 2.50

Iamgold Corporation presently has a consensus target price of $5.85, indicating a potential upside of 3.17%. Agnico Eagle Mines Limited has a consensus target price of $55.36, indicating a potential upside of 17.68%. Given Agnico Eagle Mines Limited’s stronger consensus rating and higher probable upside, analysts plainly believe Agnico Eagle Mines Limited is more favorable than Iamgold Corporation.

Institutional and Insider Ownership

57.3% of Iamgold Corporation shares are owned by institutional investors. Comparatively, 60.3% of Agnico Eagle Mines Limited shares are owned by institutional investors. 0.5% of Agnico Eagle Mines Limited shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Agnico Eagle Mines Limited beats Iamgold Corporation on 14 of the 17 factors compared between the two stocks.

Iamgold Corporation Company Profile

IAMGOLD Corporation (IAMGOLD) is engaged primarily in the exploration for, and the development and production of, mineral resource properties throughout the world. Through its holdings, IAMGOLD has interests in various operations, exploration and development properties. IAMGOLD is a mid-tier mining company with approximately four operating gold mines on over three continents. The Company’s gold mine segment is divided into geographic segments, such as Burkina Faso – Essakane mine; Suriname-Rosebel mine; Canada-Doyon division, which includes the Westwood mine and the Doyon mine, and Joint ventures (Mali)-Sadiola mine (41%) and Yatela mine (40%). The Company’s non-gold segments are divided into Exploration and evaluation, and Corporate, which includes royalty interests located in Canada and investments in associates and joint ventures. In Canada, the Company owns the Westwood mine in Quebec and the Cote Gold project, a development project located in Ontario.

Agnico Eagle Mines Limited Company Profile

Agnico Eagle Mines Limited is a gold producer with mining operations in northwestern Quebec, northern Mexico, northern Finland and Nunavut and exploration activities in Canada, Europe, Latin America and the United States. The Company operates through three business units. The Northern Business consists of its operations in Canada and Finland. The Company’s Canadian properties include the LaRonde mine, the Lapa mine, the Goldex mine, the Meadowbank mine and the Meliadine project, and Canadian Malartic Mine. The operations in Finland include the Kittila mine. The Southern Business consists of its operations in Mexico. Its Pinos Altos mine includes the Creston Mascota deposit. The La India mine is owned by its indirect subsidiary. Its Exploration group focuses on the identification of new mineral reserves and mineral resources, and new development opportunities in gold producing regions. Its exploration activities are concentrated in Canada, Europe, Latin America and the United States.

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