AngloGold Ashanti Limited (NYSE: AU) and Newmont Mining Corporation (NYSE:NEM) are both mid-cap basic materials companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, analyst recommendations, earnings, risk, institutional ownership, profitability and dividends.

Insider & Institutional Ownership

35.1% of AngloGold Ashanti Limited shares are owned by institutional investors. Comparatively, 82.2% of Newmont Mining Corporation shares are owned by institutional investors. 0.3% of Newmont Mining Corporation shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability

This table compares AngloGold Ashanti Limited and Newmont Mining Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AngloGold Ashanti Limited N/A N/A N/A
Newmont Mining Corporation -6.73% 6.67% 3.82%

Volatility and Risk

AngloGold Ashanti Limited has a beta of -1.37, indicating that its stock price is 237% less volatile than the S&P 500. Comparatively, Newmont Mining Corporation has a beta of 0.21, indicating that its stock price is 79% less volatile than the S&P 500.

Earnings and Valuation

This table compares AngloGold Ashanti Limited and Newmont Mining Corporation’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
AngloGold Ashanti Limited $4.08 billion 0.98 $1.34 billion N/A N/A
Newmont Mining Corporation $7.11 billion 2.69 $2.76 billion ($0.90) -39.81

Newmont Mining Corporation has higher revenue and earnings than AngloGold Ashanti Limited.

Dividends

AngloGold Ashanti Limited pays an annual dividend of $0.09 per share and has a dividend yield of 0.9%. Newmont Mining Corporation pays an annual dividend of $0.20 per share and has a dividend yield of 0.6%. Newmont Mining Corporation pays out -22.2% of its earnings in the form of a dividend.

Analyst Ratings

This is a summary of current ratings and recommmendations for AngloGold Ashanti Limited and Newmont Mining Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AngloGold Ashanti Limited 1 4 3 0 2.25
Newmont Mining Corporation 1 5 11 0 2.59

AngloGold Ashanti Limited presently has a consensus target price of $12.43, suggesting a potential upside of 26.58%. Newmont Mining Corporation has a consensus target price of $41.93, suggesting a potential upside of 17.03%. Given AngloGold Ashanti Limited’s higher possible upside, equities research analysts clearly believe AngloGold Ashanti Limited is more favorable than Newmont Mining Corporation.

Summary

Newmont Mining Corporation beats AngloGold Ashanti Limited on 11 of the 14 factors compared between the two stocks.

About AngloGold Ashanti Limited

AngloGold Ashanti Limited (AngloGold Ashanti) is a gold mining company. The Company’s business activities span the spectrum of the mining value chain. Its main product is gold. Its portfolio includes over 17 mines in approximately nine countries. It also produces silver, uranium and sulfuric acid as by-products. The Company operates through four segments: South Africa, Continental Africa, Australasia and Americas. Its South African operations comprise over four mines and surface production facilities, which include the Vaal River operations, including Kopanang and Moab Khotsong; The West Wits operations, including Mponeng and TauTona, and surface operations. It has operations in Continental Africa in locations, including Democratic Republic of the Congo, Ghana, Guinea, Mali and Tanzania. The Australasia segment includes the operations in Australia. It consists of Sunrise Dam and Tropicana. The Americas segment includes the operations in Argentina, Brazil and the United States.

About Newmont Mining Corporation

Newmont Mining Corporation is a mining company, which is focused on the production of and exploration for gold and copper. The Company is primarily a gold producer with operations and/or assets in the United States, Australia, Peru, Ghana and Suriname. The Company’s segments include North America, South America, Asia Pacific and Africa. The Company’s North America segment consists primarily of Carlin, Phoenix, Twin Creeks and Long Canyon in the state of Nevada, and Cripple Creek &Victor (CC&V) in the state of Colorado, in the United States. The Company’s South America segment consists primarily of Yanacocha in Peru and Merian in Suriname. The Company’s Asia Pacific segment consists primarily of Boddington, Tanami and Kalgoorlie in Australia. The Company’s Africa segment consists primarily of Ahafo and Akyem in Ghana. As of December 31, 2016, it had gold reserves of 68.5 million ounces and an aggregate land position of approximately 23,000 square miles (59,000 square kilometers).

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