IAMGOLD (IAG) & Barrick Gold (ABX) Critical Contrast

IAMGOLD (NYSE: IAG) and Barrick Gold (NYSE:ABX) are both mid-cap basic materials companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, dividends, risk, earnings, analyst recommendations, valuation and profitability.

Analyst Ratings

This is a breakdown of recent recommendations for IAMGOLD and Barrick Gold, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
IAMGOLD 0 6 3 0 2.33
Barrick Gold 1 11 2 0 2.07

IAMGOLD currently has a consensus target price of $7.05, indicating a potential upside of 21.06%. Barrick Gold has a consensus target price of $18.41, indicating a potential upside of 26.43%. Given Barrick Gold’s higher possible upside, analysts clearly believe Barrick Gold is more favorable than IAMGOLD.

Institutional & Insider Ownership

56.0% of IAMGOLD shares are held by institutional investors. Comparatively, 55.7% of Barrick Gold shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Volatility & Risk

IAMGOLD has a beta of -0.57, meaning that its share price is 157% less volatile than the S&P 500. Comparatively, Barrick Gold has a beta of -0.42, meaning that its share price is 142% less volatile than the S&P 500.

Earnings and Valuation

This table compares IAMGOLD and Barrick Gold’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
IAMGOLD $987.10 million 2.74 $52.60 million $1.09 5.34
Barrick Gold $8.56 billion 1.98 $655.00 million $1.87 7.79

Barrick Gold has higher revenue and earnings than IAMGOLD. IAMGOLD is trading at a lower price-to-earnings ratio than Barrick Gold, indicating that it is currently the more affordable of the two stocks.

Dividends

Barrick Gold pays an annual dividend of $0.12 per share and has a dividend yield of 0.8%. IAMGOLD does not pay a dividend. Barrick Gold pays out 6.4% of its earnings in the form of a dividend.

Profitability

This table compares IAMGOLD and Barrick Gold’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
IAMGOLD 48.66% 1.81% 1.23%
Barrick Gold 25.72% 7.73% 3.37%

Summary

Barrick Gold beats IAMGOLD on 9 of the 15 factors compared between the two stocks.

About IAMGOLD

IAMGOLD Corporation (IAMGOLD) is engaged primarily in the exploration for, and the development and production of, mineral resource properties throughout the world. Through its holdings, IAMGOLD has interests in various operations, exploration and development properties. IAMGOLD is a mid-tier mining company with approximately four operating gold mines on over three continents. The Company’s gold mine segment is divided into geographic segments, such as Burkina Faso – Essakane mine; Suriname-Rosebel mine; Canada-Doyon division, which includes the Westwood mine and the Doyon mine, and Joint ventures (Mali)-Sadiola mine (41%) and Yatela mine (40%). The Company’s non-gold segments are divided into Exploration and evaluation, and Corporate, which includes royalty interests located in Canada and investments in associates and joint ventures. In Canada, the Company owns the Westwood mine in Quebec and the Cote Gold project, a development project located in Ontario.

About Barrick Gold

Barrick Gold Corporation (Barrick) is a gold mining company. The Company is principally engaged in the production and sale of gold and copper, as well as related activities, such as exploration and mine development. The Company’s segments include Goldstrike, Cortez, Pueblo Viejo, Lagunas Norte, Veladero, Turquoise Ridge, Acacia Mining plc (Acacia), Pascua-Lama and Other Mines. Goldstrike, Cortez, Pueblo Viejo, Lagunas Norte, Veladero and Turquoise Ridge are its individual gold mines. The Company, through its subsidiary, Acacia, owns gold mines and exploration properties in Africa. It also holds interest in gold mines, including Porgera and Kalgoorlie, and copper mines, such as Zaldivar and Lumwana. The Pascua-Lama project is located on the border between Chile and Argentina. The Company has nine producing gold mines, which are located in Canada, the United States, Peru, Argentina, Australia and the Dominican Republic.

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