Pershing Gold (NASDAQ: PGLC) and Alamos Gold (NYSE:AGI) are both basic materials companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, dividends, risk, profitability and institutional ownership.

Analyst Ratings

This is a summary of recent recommendations for Pershing Gold and Alamos Gold, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pershing Gold 0 0 3 0 3.00
Alamos Gold 0 4 2 0 2.33

Pershing Gold currently has a consensus price target of $8.00, suggesting a potential upside of 210.08%. Alamos Gold has a consensus price target of $10.38, suggesting a potential upside of 68.70%. Given Pershing Gold’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Pershing Gold is more favorable than Alamos Gold.

Volatility and Risk

Pershing Gold has a beta of 0.91, indicating that its share price is 9% less volatile than the S&P 500. Comparatively, Alamos Gold has a beta of 0.46, indicating that its share price is 54% less volatile than the S&P 500.

Profitability

This table compares Pershing Gold and Alamos Gold’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Pershing Gold N/A -41.82% -39.57%
Alamos Gold 2.08% 1.07% 0.82%

Earnings and Valuation

This table compares Pershing Gold and Alamos Gold’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Pershing Gold N/A N/A -$15.63 million ($0.54) -4.78
Alamos Gold $482.20 million 4.96 -$17.90 million $0.02 307.50

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

Dividends

Alamos Gold pays an annual dividend of $0.02 per share and has a dividend yield of 0.3%. Pershing Gold does not pay a dividend. Alamos Gold pays out 100.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Institutional and Insider Ownership

19.6% of Pershing Gold shares are owned by institutional investors. Comparatively, 63.0% of Alamos Gold shares are owned by institutional investors. 36.8% of Pershing Gold shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

About Pershing Gold

Pershing Gold Corporation is a gold and precious metals exploration company. The Company focuses on exploration, development and mining opportunities in Nevada. The Company is focused on exploration at its Relief Canyon properties in Pershing County in northwestern Nevada. The Company operates its business directly and also through its subsidiary, Gold Acquisition Corp. Gold Acquisition Corp. owns and is engaged in conducting exploration on the Relief Canyon Mine property in northwestern Nevada. The Company is engaged in conducting exploration on the Relief Canyon expansion properties. The Relief Canyon Mine includes approximately three open pit mines, heap leach pads consisting of approximately six cells, approximately two solution ponds and a cement block constructed adsorption desorption-recovery (ADR) solution processing circuit. The Pershing Pass property includes approximately 490 lode mining claims. The Company has not generated any revenues.

About Alamos Gold

Alamos Gold Inc. is a Canada-based mid-tier gold producer. The Company owns and operates the Mulatos Mine, as well as the Esperanza, Agi Dagi, Kirazli and Camyurt gold development projects. The Mulatos mine is located within the 30,536 hectares Salamandra group of concessions in the state of Sonora in northwest Mexico. The Esperanza Gold Project is a development stage asset located in south-central Mexico in the state of Morelos. Agi Dagi and Kirazli gold development projects are located in Canakkale Province on the Biga Peninsula of northwestern Turkey. The Camyurt project is located near southeast of Canakkale, Turkey. In addition, the Company owns a 100% interest in the Quartz Mountain Property, which is located on the northern extension of the prolific Basin and Range Province of Nevada in Oregon.

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