Freeport-McMoran (NYSE: FCX) and MAG Silver Corp (NYSE:MAG) are both basic materials companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, profitability, dividends, valuation and risk.

Insider & Institutional Ownership

67.9% of Freeport-McMoran shares are owned by institutional investors. 1.3% of Freeport-McMoran shares are owned 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.

Valuation & Earnings

This table compares Freeport-McMoran and MAG Silver Corp’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Freeport-McMoran $15.31 billion 1.37 $5.20 billion $0.71 20.46
MAG Silver Corp N/A N/A -$6.98 million N/A N/A

Freeport-McMoran has higher revenue and earnings than MAG Silver Corp.

Profitability

This table compares Freeport-McMoran and MAG Silver Corp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Freeport-McMoran 5.97% 10.45% 2.60%
MAG Silver Corp N/A -3.01% -3.00%

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Freeport-McMoran and MAG Silver Corp, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Freeport-McMoran 2 11 4 0 2.12
MAG Silver Corp 0 0 5 2 3.29

Freeport-McMoran currently has a consensus target price of $15.40, suggesting a potential upside of 5.99%. MAG Silver Corp has a consensus target price of $17.33, suggesting a potential upside of 50.33%. Given MAG Silver Corp’s stronger consensus rating and higher possible upside, analysts clearly believe MAG Silver Corp is more favorable than Freeport-McMoran.

Summary

Freeport-McMoran beats MAG Silver Corp on 7 of the 11 factors compared between the two stocks.

Freeport-McMoran Company Profile

Freeport-McMoRan Inc. (FCX) is a mining company. The Company operates through geographical assets with proven and probable reserves of copper, gold and molybdenum, and traded copper producer. The Company’s segments include refined copper products, copper in concentrate, gold, molybdenum, oil and other. The Company’s segments include the Morenci, Cerro Verde, Grasberg copper mines, the Rod & Refining operations and the United States (U.S.) Oil and Gas Operations. The Company has organized its operations into five divisions, which include North America copper mines, South America mining, Indonesia mining and Molybdenum mines. The Company’s portfolio of assets includes the Grasberg minerals district in Indonesia, copper and gold deposits, and mining operations in the Americas, including the large-scale Morenci minerals district in North America and the Cerro Verde operation in South America.

MAG Silver Corp Company Profile

MAG Silver Corp. is a mineral exploration and development company. The Company is focused on the acquisition, exploration and development of projects located within the Mexican silver belt. The Company operates through the exploration of mineral properties in Mexico segment. The Company’s projects include Juanicipio Property, Cinco De Mayo Property and Guigui Property. Juanicipio Property is located in the Fresnillo District, Zacatecas State, Mexico. The Juanicipio Property includes silver-gold-lead-zinc epithermal vein deposit. The Company owns the mineral concessions comprising the Cinco de Mayo Property. The Cinco de Mayo Property is located approximately 190 kilometers northwest of the city of Chihuahua, in northern Chihuahua State, Mexico, and covers approximately 25,110 hectares. The Company owns the Guigui project located in the Santa Eulalia Mining District of Chihuahua, Mexico. Guigui project consists of approximately 8,300 hectares.

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