Ciner Resources (NYSE: CINR) and Royal Gold (NASDAQ:RGLD) are both basic materials companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, valuation, profitability, risk and dividends.

Analyst Recommendations

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This is a breakdown of current ratings for Ciner Resources and Royal Gold, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ciner Resources 0 2 1 0 2.33
Royal Gold 0 7 7 0 2.50

Ciner Resources currently has a consensus target price of $25.00, indicating a potential downside of 8.42%. Royal Gold has a consensus target price of $95.50, indicating a potential upside of 13.47%. Given Royal Gold’s stronger consensus rating and higher possible upside, analysts plainly believe Royal Gold is more favorable than Ciner Resources.

Volatility & Risk

Ciner Resources has a beta of 0.89, indicating that its share price is 11% less volatile than the S&P 500. Comparatively, Royal Gold has a beta of 0.7, indicating that its share price is 30% less volatile than the S&P 500.

Institutional & Insider Ownership

10.0% of Ciner Resources shares are owned by institutional investors. Comparatively, 77.7% of Royal Gold shares are owned by institutional investors. 1.1% of Royal Gold shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Ciner Resources and Royal Gold’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ciner Resources 8.37% 16.66% 9.52%
Royal Gold 13.00% 4.31% 3.24%

Earnings & Valuation

This table compares Ciner Resources and Royal Gold’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Ciner Resources $497.30 million 1.08 $41.60 million $2.07 13.19
Royal Gold $440.81 million 12.50 $101.53 million $0.88 95.64

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

Dividends

Ciner Resources pays an annual dividend of $2.27 per share and has a dividend yield of 8.3%. Royal Gold pays an annual dividend of $1.00 per share and has a dividend yield of 1.2%. Ciner Resources pays out 109.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Royal Gold pays out 113.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ciner Resources has raised its dividend for 13 consecutive years. Ciner Resources is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Royal Gold beats Ciner Resources on 9 of the 17 factors compared between the two stocks.

About Ciner Resources

Ciner Resources LP, through its subsidiary, Ciner Wyoming LLC (Ciner Wyoming), produces soda ash and serves a global market from its facility in the Green River Basin of Wyoming. The Company processes trona ore into soda ash, a raw material in flat glass, container glass, detergents, chemicals, paper and other consumer and industrial products. As of December 31, 2016, its Green River Basin surface operations were situated on approximately 880 acres in Wyoming, and the Company’s mining operations included approximately 23,500 acres of leased and licensed subsurface mining area. The Company’s mining leases and license are located in two mining beds, designated by the United States Geological Survey as beds 24 and 25, at depths of 800 to 1100 feet, respectively, below the surface. The Company uses a continuous mining technique to mine trona and roof bolt the ceiling simultaneously. The Company’s soda ash is shipped by rail or truck from its Green River Basin operations.

About Royal Gold

Royal Gold, Inc., together with its subsidiaries, is engaged in acquiring and managing precious metal streams, royalties and similar interests. The Company operates through two segments: Acquisition and Management of Stream Interests, and Acquisition and Management of Royalty Interests. Its assets are located in Canada, Chile, Dominican Republic, Mexico, the United States, Africa, Australia and Other. As of June 30, 2016, the Company owned stream interests on four producing properties and three development-stage properties. It has investments in stream interests relating to Pueblo Viejo, Andacollo, Wassa and Prestea, and Rainy River. As of June 30, 2016, the Company owned royalty interests on 34 producing properties, 21 development-stage properties and 131 exploration-stage properties, of which it considered 50 to be evaluation-stage projects.

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