McEwen Mining (NYSE: MUX) and Rio Alto Mining (NYSE:RIOM) are both basic materials companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, valuation, analyst recommendations, risk, earnings, dividends and institutional ownership.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for McEwen Mining and Rio Alto Mining, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
McEwen Mining 0 0 2 0 3.00
Rio Alto Mining 0 0 0 0 N/A

McEwen Mining currently has a consensus target price of $5.00, suggesting a potential upside of 143.90%. Given McEwen Mining’s higher probable upside, analysts plainly believe McEwen Mining is more favorable than Rio Alto Mining.

Earnings & Valuation

This table compares McEwen Mining and Rio Alto Mining’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
McEwen Mining $60.39 million 11.30 $21.05 million ($0.06) -34.17
Rio Alto Mining N/A N/A N/A N/A N/A

McEwen Mining has higher revenue and earnings than Rio Alto Mining.

Insider and Institutional Ownership

27.3% of McEwen Mining shares are held by institutional investors. 26.1% of McEwen Mining shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares McEwen Mining and Rio Alto Mining’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
McEwen Mining -31.71% -4.25% -3.79%
Rio Alto Mining N/A N/A N/A

Summary

McEwen Mining beats Rio Alto Mining on 5 of the 8 factors compared between the two stocks.

About McEwen Mining

McEwen Mining Inc. is a mining and minerals production and exploration company. The Company is focused on precious and base metals in Argentina, Mexico and the United States. The Company’s segments include Mexico, Minera Santa Cruz S.A. (MSC), Nevada and Los Azules. The Mexico Operations segment includes properties, such as El Gallo 1 mine and the El Gallo 2 project. The MSC segment includes properties, such as the San Jose mine and other concessions located around the mine. The Company’s properties in Nevada segment include Gold Bar project and exploration properties. The Gold Bar project is a proposed mine project. The Los Azules segment includes various properties, such as Los Azules project, Chonchones project, Laganoso project, La Cerrada project and Other Argentina properties. The Los Azules copper project is an advanced-stage porphyry copper exploration project located in the cordilleran region of San Juan Province, Argentina near the border with Chile.

About Rio Alto Mining

Rio Alto Mining Limited is a Canada-based resource exploration company. The Company is engaged in the business of acquiring, exploring, developing and operating mineral resource properties in Peru. The Company is also engaged in the business of acquiring, exploring, and developing gold resources and advanced stage exploration projects in Peru and Latin America. The Company owns and operates the La Arena Mine and the Shahuindo Gold Projects in northern Peru. The Company is focused on the development of the 21,000 hectares La Arena gold / copper project, located in north central Peru. The La Arena Project consists of 20,673 hectares in 44 concessions located 480 kilometers north-northwest of Lima, the capital of Peru, and approximately 18 kilometers from Huamachuco.

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