Fortuna Silver Mines (NYSE: FSM) and Allegheny Technologies (NYSE:ATI) are both basic materials companies, but which is the better business? We will compare the two companies based on the strength of their valuation, earnings, dividends, analyst recommendations, risk, profitability and institutional ownership.

Earnings & Valuation

This table compares Fortuna Silver Mines and Allegheny Technologies’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Fortuna Silver Mines $251.82 million 2.88 $118.59 million $0.25 18.24
Allegheny Technologies $3.31 billion 0.83 $295.80 million ($4.61) -5.46

Allegheny Technologies has higher revenue and earnings than Fortuna Silver Mines. Allegheny Technologies is trading at a lower price-to-earnings ratio than Fortuna Silver Mines, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Fortuna Silver Mines and Allegheny Technologies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Fortuna Silver Mines 15.97% 9.08% 7.07%
Allegheny Technologies -14.89% 0.08% 0.02%

Volatility & Risk

Fortuna Silver Mines has a beta of 0.16, indicating that its share price is 84% less volatile than the S&P 500. Comparatively, Allegheny Technologies has a beta of 2.51, indicating that its share price is 151% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Fortuna Silver Mines and Allegheny Technologies, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Fortuna Silver Mines 0 1 3 1 3.00
Allegheny Technologies 0 4 4 0 2.50

Fortuna Silver Mines presently has a consensus price target of $9.00, suggesting a potential upside of 97.37%. Allegheny Technologies has a consensus price target of $20.65, suggesting a potential downside of 18.02%. Given Fortuna Silver Mines’ stronger consensus rating and higher possible upside, analysts plainly believe Fortuna Silver Mines is more favorable than Allegheny Technologies.

Insider & Institutional Ownership

44.7% of Fortuna Silver Mines shares are owned by institutional investors. Comparatively, 96.6% of Allegheny Technologies shares are owned by institutional investors. 1.1% of Allegheny Technologies shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Fortuna Silver Mines beats Allegheny Technologies on 8 of the 14 factors compared between the two stocks.

About Fortuna Silver Mines

Fortuna Silver Mines Inc. is a Canada-based mining company engaged in silver mining and related activities in Latin America, including exploration, extraction and processing. The Company operates the Caylloma silver, lead, and zinc mine (Caylloma) in southern Peru and the San Jose silver and gold mine (San Jose) in southern Mexico. The Company’s segments include Corporate, Bateas and Cuzcatlan. The Company owns interest in the Caylloma mine and related mining concessions located in southern Peru. The Caylloma property is located in the Caylloma Mining District, approximately 220 kilometers north-northwest of Arequipa, Peru. The Company produces approximately 1.7 million ounces of silver and over 1,160 ounces of gold at Caylloma. The Company’s San Jose property, which covers a silver gold bearing epithermal vein system is located in the state of Oaxaca in southern Mexico. The Company produces approximately 4.9 million ounces of silver and over 38,530 ounces of gold at San Jose.

About Allegheny Technologies

Allegheny Technologies Incorporated is a manufacturer of specialty materials and complex components. The Company operates through two business segments: High Performance Materials & Components (HPMC), and Flat Rolled Products (FRP). The HPMC segment produces, converts and distributes a range of materials, including titanium and titanium-based alloys, nickel- and cobalt-based alloys and superalloys, zirconium and related alloys, including hafnium and niobium, advanced powder alloys and other specialty materials, in long product forms, such as ingot, billet, bar, rod, wire, shapes and rectangles, and seamless tubes, plus precision forgings, castings, components and machined parts. The FRP segment produces, converts and distributes stainless steel, nickel-based alloys, specialty alloys, and titanium and titanium-based alloys, in a range of product forms, including plate, sheet, engineered strip, and Precision Rolled Strip products.

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