Critical Analysis: Glencore (OTCMKTS:GLNCY) and Impala Platinum (OTCMKTS:IMPUY)

Glencore (OTCMKTS:GLNCY) and Impala Platinum (OTCMKTS:IMPUY) are both basic materials companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, earnings, valuation, profitability and dividends.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Glencore and Impala Platinum, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Glencore	0	3	6	2	2.91
Impala Platinum	0	1	2	0	2.67

Glencore currently has a consensus target price of $9.30, indicating a potential downside of 40.88%. Impala Platinum has a consensus target price of $23.00, indicating a potential upside of 96.08%. Given Impala Platinum’s higher possible upside, analysts clearly believe Impala Platinum is more favorable than Glencore.

Volatility and Risk

Glencore has a beta of 0.6, indicating that its stock price is 40% less volatile than the S&P 500. Comparatively, Impala Platinum has a beta of 0.75, indicating that its stock price is 25% less volatile than the S&P 500.

Earnings and Valuation

This table compares Glencore and Impala Platinum”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Glencore	$247.54 billion	0.37	$363.00 million	N/A	N/A
Impala Platinum	$4.71 billion	2.24	$41.85 million	N/A	N/A

Glencore has higher revenue and earnings than Impala Platinum.

Institutional & Insider Ownership

0.1% of Glencore shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Dividends

Glencore pays an annual dividend of $0.27 per share and has a dividend yield of 1.7%. Impala Platinum pays an annual dividend of $0.36 per share and has a dividend yield of 3.1%.

Profitability

This table compares Glencore and Impala Platinum’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Glencore	N/A	N/A	N/A
Impala Platinum	N/A	N/A	N/A

Summary

Glencore beats Impala Platinum on 6 of the 10 factors compared between the two stocks.

About Glencore

Glencore plc engages in the production, refinement, processing, storage, transport, and marketing of metals and minerals, and energy products in the Americas, Europe, Asia, Africa, and Oceania. It operates through two segments: Marketing Activities and Industrial Activities. The company engages in production and marketing copper, cobalt, lead, nickel, zinc, chrome ore, ferrochrome, vanadium, aluminum, alumina, and iron ore; and coal, crude oil, refined products, and natural gas, as well as oil exploration/production and refining/distribution. It also operates marketing and distribution of physical commodities sourced from third party producers and company’s production to industrial consumers, including the battery, electronic, construction, automotive, steel, energy, and oil industries. In addition, the company provides financing, logistics, and other services to producers and consumers of commodities. Glencore plc was founded in 1974 and is headquartered in Baar, Switzerland.

About Impala Platinum

Impala Platinum Holdings Limited engages in the mining, processing, concentrating, refining, and sale of platinum group metals (PGMs) and associated base metals. The company produces platinum, palladium, rhodium, nickel, and by-products, as well as ruthenium, iridium, and gold. It has operations on the PGM-bearing orebodies, including the Bushveld Complex located in South Africa; and the Great Dyke situated in Zimbabwe, as well as the Canadian Shield. The company markets and sells its products in South Africa, Japan, China, the United States, and Europe. Impala Platinum Holdings Limited was incorporated in 1957 and is based in Sandton, South Africa.