McEwen Mining (NYSE: MUX) and New Gold (NYSE:NGD) 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, profitability, analyst recommendations and institutional ownership.

Insider & Institutional Ownership

29.3% of McEwen Mining shares are held by institutional investors. 26.6% of McEwen 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.

Dividends

McEwen Mining pays an annual dividend of $0.01 per share and has a dividend yield of 0.4%. New Gold does not pay a dividend. McEwen Mining pays out -50.0% of its earnings in the form of a dividend.

Profitability

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

Net Margins Return on Equity Return on Assets
McEwen Mining -9.19% -1.69% -1.51%
New Gold 12.45% 4.03% 2.24%

Earnings & Valuation

This table compares McEwen Mining and New Gold’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
McEwen Mining $54.53 million 16.21 -$11.30 million ($0.02) -141.50
New Gold $704.10 million 3.37 $282.10 million N/A N/A

New Gold has higher revenue and earnings than McEwen Mining.

Analyst Recommendations

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

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
McEwen Mining 0 0 1 0 3.00
New Gold 1 4 3 0 2.25

McEwen Mining currently has a consensus target price of $5.00, indicating a potential upside of 76.68%. New Gold has a consensus target price of $3.88, indicating a potential downside of 5.74%. Given McEwen Mining’s stronger consensus rating and higher possible upside, equities analysts plainly believe McEwen Mining is more favorable than New Gold.

Summary

McEwen Mining beats New Gold on 7 of the 13 factors compared between the two stocks.

About McEwen Mining

McEwen Mining Inc. is a mining and minerals production and exploration company. The Company is focused on precious and base metals in Argentina, Mexico and the United States. The Company’s segments include Mexico, Minera Santa Cruz S.A. (MSC), Nevada and Los Azules. The Mexico Operations segment includes properties, such as El Gallo 1 mine and the El Gallo 2 project. The MSC segment includes properties, such as the San Jose mine and other concessions located around the mine. The Company’s properties in Nevada segment include Gold Bar project and exploration properties. The Gold Bar project is a proposed mine project. The Los Azules segment includes various properties, such as Los Azules project, Chonchones project, Laganoso project, La Cerrada project and Other Argentina properties. The Los Azules copper project is an advanced-stage porphyry copper exploration project located in the cordilleran region of San Juan Province, Argentina near the border with Chile.

About New Gold

New Gold Inc. is an intermediate gold mining company. The Company is engaged in the development and operation of mineral properties. Its segments include New Afton, Mesquite, Peak Mines, Cerro San Pedro, Corporate and Other. It has operating mines in Canada, the United States, Australia and Mexico; development projects in Canada, and a stream on gold production from a development property in Chile. Its development projects include Rainy River and Blackwater projects, which are located in Canada. Its Rainy River project is a gold project located approximately 65 kilometers northwest of Fort Frances in northwestern Ontario, Canada. The Rainy River comprises approximately 192 square kilometers of various rights and claims. The Blackwater Project is located approximately 160 kilometers southwest of the city of Prince George in central British Columbia, Canada and 110 kilometers southwest of the town of Vanderhoof. The Blackwater project covers an area of over 1,000 square kilometers.

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