Sibanye Gold Limited (NYSE: SBGL) and Randgold Resources Limited (NASDAQ:GOLD) are both basic materials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, institutional ownership, analyst recommendations, earnings, profitability, valuation and dividends.

Risk & Volatility

Sibanye Gold Limited has a beta of -0.17, meaning that its share price is 117% less volatile than the S&P 500. Comparatively, Randgold Resources Limited has a beta of 0.02, meaning that its share price is 98% less volatile than the S&P 500.

Institutional and Insider Ownership

35.8% of Sibanye Gold Limited shares are held by institutional investors. Comparatively, 35.7% of Randgold Resources Limited shares are held by institutional investors. 0.1% of Sibanye Gold Limited shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and target prices for Sibanye Gold Limited and Randgold Resources Limited, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sibanye Gold Limited 1 2 1 0 2.00
Randgold Resources Limited 1 7 6 0 2.36

Randgold Resources Limited has a consensus target price of $102.33, suggesting a potential upside of 4.79%. Given Randgold Resources Limited’s stronger consensus rating and higher probable upside, analysts plainly believe Randgold Resources Limited is more favorable than Sibanye Gold Limited.

Valuation & Earnings

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

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Sibanye Gold Limited $2.76 billion 0.86 $607.55 million N/A N/A
Randgold Resources Limited N/A N/A N/A $3.13 31.20

Sibanye Gold Limited has higher revenue and earnings than Randgold Resources Limited.

Dividends

Sibanye Gold Limited pays an annual dividend of $0.14 per share and has a dividend yield of 3.1%. Randgold Resources Limited pays an annual dividend of $0.98 per share and has a dividend yield of 1.0%. Randgold Resources Limited pays out 31.3% of its earnings in the form of a dividend.

Profitability

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

Net Margins Return on Equity Return on Assets
Sibanye Gold Limited N/A N/A N/A
Randgold Resources Limited 22.75% 7.89% 7.33%

Summary

Randgold Resources Limited beats Sibanye Gold Limited on 7 of the 12 factors compared between the two stocks.

Sibanye Gold Limited Company Profile

Sibanye Gold Limited is an independent, global precious metal mining company. The Company is engaged in producing a mix of metals that includes gold and the platinum group metals (PGMs). Its projects are grouped by two regions: the Southern Africa region and the Americas region. Its products include gold, platinum group metals and by-products. The Company’s gold project in the Southern Africa region includes Beatrix, Cooke, Driefontein, and Kloof. Its PGM projects include Kroondal, Rustenburg operations, Mimosa, and Platinum Mile. Its other projects in the Southern Africa region include Burnstone, Kloof Decline, Driefontein decline, The West Rand Tailings Retreatment Project (WRTRP) and The Southern Free State (SOFS) project. The Company’s PGM project in the Americas region includes East Boulder, Stillwater, and Columbus Metallurgical Complex. Its other projects in the Americas region include Blitz, Altar and Marathon.

Randgold Resources Limited Company Profile

Randgold Resources Limited is engaged in gold mining, exploration and related activities. The Company’s activities are focused on West and Central Africa. The Company operates through the gold mining segment. The Company operates various mines, such as Morila, Loulo, Gounkoto, Tongon and Kibali. The Company is exploring in African countries, such as Mali, Senegal, Cote d’Ivoire and the Democratic Republic of Congo (DRC). The Company also holds an interest in the Massawa project. The Company holds Morila Limited, which holds interests in the Morila mine in Mali. As of December 31, 2016, Morila mine has produced 122,370 ounces (oz) of gold. The Company holds a controlling interest in the Loulo mine, located in Mali, through Societe des Mines de Loulo SA (Loulo). The Loulo mine is mining from over two underground mines. As of December 31, 2016, Loulo mine has produced 350,604 oz of gold. It has a controlling interest in the Gounkoto mine through Societe des Mines de Gounkoto SA.

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