Buenaventura Mining (NYSE:BVN) vs. First Majestic Silver (NYSE:AG) Critical Comparison

First Majestic Silver (NYSE:AG) and Buenaventura Mining (NYSE:BVN) are both mid-cap basic materials companies, but which is the better business? We will compare the two companies based on the strength of their profitability, valuation, dividends, earnings, analyst recommendations, institutional ownership and risk.

Insider and Institutional Ownership

27.2% of First Majestic Silver shares are owned by institutional investors. 0.9% of First Majestic Silver shares are owned by company insiders. Comparatively, 19.3% of Buenaventura Mining shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares First Majestic Silver and Buenaventura Mining’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Majestic Silver	-12.32%	-0.14%	-0.10%
Buenaventura Mining	39.60%	9.19%	6.53%

Dividends

First Majestic Silver pays an annual dividend of $0.02 per share and has a dividend yield of 0.2%. Buenaventura Mining pays an annual dividend of $0.28 per share and has a dividend yield of 1.7%. First Majestic Silver pays out -6.9% of its earnings in the form of a dividend. Buenaventura Mining pays out 14.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Analyst Recommendations

This is a breakdown of current recommendations for First Majestic Silver and Buenaventura Mining, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Majestic Silver	0	4	1	0	2.20
Buenaventura Mining	0	1	1	0	2.50

First Majestic Silver currently has a consensus price target of $8.75, suggesting a potential upside of 8.76%. Buenaventura Mining has a consensus price target of $16.75, suggesting a potential upside of 4.61%. Given First Majestic Silver’s higher probable upside, research analysts clearly believe First Majestic Silver is more favorable than Buenaventura Mining.

Earnings & Valuation

This table compares First Majestic Silver and Buenaventura Mining”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Majestic Silver	$560.60 million	6.95	-$101.89 million	($0.29)	-27.74
Buenaventura Mining	$1.15 billion	3.52	$402.69 million	$1.89	8.47

Buenaventura Mining has higher revenue and earnings than First Majestic Silver. First Majestic Silver is trading at a lower price-to-earnings ratio than Buenaventura Mining, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

First Majestic Silver has a beta of 0.74, indicating that its stock price is 26% less volatile than the S&P 500. Comparatively, Buenaventura Mining has a beta of 0.42, indicating that its stock price is 58% less volatile than the S&P 500.

Summary

Buenaventura Mining beats First Majestic Silver on 10 of the 15 factors compared between the two stocks.

About First Majestic Silver

First Majestic Silver Corp. engages in the acquisition, exploration, development, and production of mineral properties with a focus on silver and gold production in North America. Its projects include the San Dimas mine covering an area of approximately 71,867 hectares located in Durango State, Mexico; the Santa Elena that covers an area of approximately 102,244 hectares located in Sonora State, México; and the La Encantada covering an area of approximately 4,076 hectares located in Coahuila State, México. The company was formerly known as First Majestic Resource Corp. and changed its name to First Majestic Silver Corp. in November 2006. First Majestic Silver Corp. was incorporated in 1979 and is headquartered in Vancouver, Canada.

About Buenaventura Mining

Compañía de Minas Buenaventura S.A.A. engages in the exploration, development, construction, and operation of mineral processing business. The company explores for gold, silver, lead, zinc, and copper metals. It operates operating mining units, including Tambomayo located in the Caylloma province, Orcopampa Unit located in the province of Castilla, Uchucchacua located in province of Oyón, Julcani located in province of Angaraes, Peru, as well as San Gabrie located in the province of General Sánchez Cerro, in the Moquegua region. The company owns interests in Colquijirca, La Zanja, Cerro Verde, El Brocal, Coimolache, Yumpaq, San Gregorio mines, and Trapiche mining unit. In addition, it produces monohydrate manganese sulphate; and operates hydroelectric power plants. Compañía de Minas Buenaventura S.A.A. was incorporated in 1953 and is based in Lima, Peru.