Financial Analysis: Endeavour Silver (EXK) versus Yamana Gold (AUY)

Endeavour Silver (NYSE: EXK) and Yamana Gold (NYSE:AUY) are both basic materials companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, risk, earnings, valuation, analyst recommendations, institutional ownership and profitability.

Dividends

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Yamana Gold pays an annual dividend of $0.02 per share and has a dividend yield of 0.7%. Endeavour Silver does not pay a dividend. Yamana Gold pays out 25.0% of its earnings in the form of a dividend.

Profitability

This table compares Endeavour Silver and Yamana Gold’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Endeavour Silver 3.87% 4.12% 3.33%
Yamana Gold -18.50% 2.33% 1.19%

Analyst Ratings

This is a summary of recent recommendations for Endeavour Silver and Yamana Gold, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Endeavour Silver 0 2 2 0 2.50
Yamana Gold 0 4 7 0 2.64

Endeavour Silver presently has a consensus price target of $6.00, suggesting a potential upside of 104.08%. Yamana Gold has a consensus price target of $3.63, suggesting a potential upside of 25.00%. Given Endeavour Silver’s higher probable upside, equities analysts plainly believe Endeavour Silver is more favorable than Yamana Gold.

Earnings and Valuation

This table compares Endeavour Silver and Yamana Gold’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Endeavour Silver $150.50 million 2.49 $9.68 million $0.08 36.75
Yamana Gold $1.80 billion 1.53 -$194.40 million $0.08 36.25

Endeavour Silver has higher earnings, but lower revenue than Yamana Gold. Yamana Gold is trading at a lower price-to-earnings ratio than Endeavour Silver, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

19.3% of Endeavour Silver shares are owned by institutional investors. Comparatively, 43.6% of Yamana Gold shares are owned by institutional investors. 2.7% of Yamana Gold shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Risk and Volatility

Endeavour Silver has a beta of -0.07, indicating that its stock price is 107% less volatile than the S&P 500. Comparatively, Yamana Gold has a beta of 0.89, indicating that its stock price is 11% less volatile than the S&P 500.

Summary

Endeavour Silver beats Yamana Gold on 8 of the 15 factors compared between the two stocks.

Endeavour Silver Company Profile

Endeavour Silver Corp., a mid-tier precious metals mining company, engages in the mining, evaluation, acquisition, exploration, development, extraction, processing, refining, and reclamation of silver in Mexico and Chile. The company also explores for gold deposits. It owns interests in the Guanacev铆 mine located in the Guanacev铆 district, Durango, Mexico; and the Bola帽itos and El Cubo silver-gold mines located in the northern parts of the Guanajuato and La Luz silver districts in the state of Guanajuato, Mexico. The company also has interests in various exploration and development projects, including the Terronera property in Jalisco state; the El Compas property in Zacatecas State; and the Parral property located in Chihuahua State, Mexico. In addition, it holds interests in the Guadalupe y Calvo property located in Chihuahua State; and the Lourdes located in the state of Guanajuato, Mexico. The company was formerly known as Endeavour Gold Corp. and changed its name to Endeavour Silver Corp. in September 2004. Endeavour Silver Corp. was founded in 1981 and is headquartered in Vancouver, Canada.

Yamana Gold Company Profile

Yamana Gold Inc. operates as a gold producer with gold production, gold development stage properties, exploration properties, and land positions throughout the Americas, including Canada, Brazil, Chile, and Argentina. It primarily sells precious metals, including gold, silver, and copper. The company was formerly known as Yamana Resources Inc. and changed its name to Yamana Gold Inc. in July 2003. Yamana Gold Inc. was founded in 1980 and is based in Toronto, Canada.

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