Sibanye Gold (NYSE: KGC) and Kinross Gold (NYSE:KGC) are both basic materials companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, valuation, profitability, analyst recommendations, dividends, institutional ownership and risk.

Valuation and Earnings

This table compares Sibanye Gold and Kinross Gold’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Sibanye Gold $3.45 billion 0.16 -$334.13 million ($0.04) -57.75
Kinross Gold $3.30 billion 1.13 $445.40 million $0.14 21.36

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

Volatility and Risk

Sibanye Gold has a beta of -0.12, suggesting that its stock price is 112% less volatile than the S&P 500. Comparatively, Kinross Gold has a beta of 0.15, suggesting that its stock price is 85% less volatile than the S&P 500.

Institutional and Insider Ownership

55.9% of Sibanye Gold shares are owned by institutional investors. Comparatively, 57.4% of Kinross Gold shares are owned by institutional investors. 0.1% of Sibanye Gold shares are owned by company insiders. Comparatively, 1.0% of Kinross Gold shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Sibanye Gold and Kinross Gold, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sibanye Gold 0 2 2 0 2.50
Kinross Gold 1 6 2 0 2.11

Kinross Gold has a consensus price target of $4.54, suggesting a potential upside of 51.84%. Given Kinross Gold’s higher probable upside, analysts plainly believe Kinross Gold is more favorable than Sibanye Gold.

Profitability

This table compares Sibanye Gold and Kinross Gold’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Sibanye Gold N/A N/A N/A
Kinross Gold 11.67% 5.73% 3.22%

Summary

Kinross Gold beats Sibanye Gold on 10 of the 12 factors compared between the two stocks.

Sibanye Gold Company Profile

Sibanye Gold Limited operates as a precious metals mining company in South Africa, Zimbabwe, and the United States. The company operates through PGM; and Gold and Uranium divisions. It owns and operates gold, and platinum group metals (PGM), including platinum, palladium, and rhodium operations and projects, as well as produces by-products, such as iridium, ruthenium, nickel, copper, and chrome. The company owns and operates four underground and surface gold operations in the West Witwatersrand region and the southern Free State province of South Africa; and underground and surface PGM operations in the Bushveld Igneous Complex in South Africa, the Great Dyke in Zimbabwe, and Montana in the United States. It also owns and manages extraction and processing facilities to produce gold doré; recycles PGMs from catalytic materials and other industrial sources; and operates a smelter and base metal refinery. Sibanye Gold Limited was incorporated in 2002 and is based in Westonaria, South Africa.

Kinross Gold Company Profile

Kinross Gold Corporation, together with its subsidiaries, engages in the acquisition, exploration, extraction, and processing of gold-containing ore. It also engages in the reclamation of gold mining properties; and production and sale of silver. The company's gold production and exploration activities are carried out principally in Canada, the United States, Russia, Brazil, Chile, Ghana, and Mauritania. The company was founded in 1972 and is headquartered in Toronto, Canada.

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