Financial Review: Triple Flag Precious Metals (NYSE:TFPM) & Newmont (NYSE:NEM)

Newmont (NYSE:NEM) and Triple Flag Precious Metals (NYSE:TFPM) are both basic materials companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, valuation, risk, analyst recommendations, profitability, dividends and earnings.

Analyst Ratings

This is a summary of current recommendations and price targets for Newmont and Triple Flag Precious Metals, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Newmont	0	4	13	5	3.05
Triple Flag Precious Metals	1	4	6	1	2.58

Newmont currently has a consensus target price of $99.35, suggesting a potential downside of 12.98%. Triple Flag Precious Metals has a consensus target price of $30.00, suggesting a potential downside of 17.66%. Given Newmont’s stronger consensus rating and higher possible upside, research analysts plainly believe Newmont is more favorable than Triple Flag Precious Metals.

Dividends

Newmont pays an annual dividend of $1.00 per share and has a dividend yield of 0.9%. Triple Flag Precious Metals pays an annual dividend of $0.23 per share and has a dividend yield of 0.6%. Newmont pays out 15.5% of its earnings in the form of a dividend. Triple Flag Precious Metals pays out 22.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Triple Flag Precious Metals has raised its dividend for 2 consecutive years. Newmont is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Newmont and Triple Flag Precious Metals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Newmont	33.42%	20.35%	11.68%
Triple Flag Precious Metals	59.43%	9.56%	9.34%

Volatility and Risk

Newmont has a beta of 0.41, indicating that its stock price is 59% less volatile than the S&P 500. Comparatively, Triple Flag Precious Metals has a beta of -0.21, indicating that its stock price is 121% less volatile than the S&P 500.

Insider & Institutional Ownership

68.8% of Newmont shares are held by institutional investors. Comparatively, 82.9% of Triple Flag Precious Metals shares are held by institutional investors. 0.1% of Newmont shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Newmont and Triple Flag Precious Metals”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Newmont	$21.50 billion	5.79	$3.35 billion	$6.44	17.73
Triple Flag Precious Metals	$268.99 million	27.98	-$23.08 million	$1.01	36.07

Newmont has higher revenue and earnings than Triple Flag Precious Metals. Newmont is trading at a lower price-to-earnings ratio than Triple Flag Precious Metals, indicating that it is currently the more affordable of the two stocks.

Summary

Newmont beats Triple Flag Precious Metals on 13 of the 18 factors compared between the two stocks.

About Newmont

Newmont Corporation engages in the production and exploration of gold. It also explores for copper, silver, zinc, and lead. The company has operations and/or assets in the United States, Canada, Mexico, Dominican Republic, Peru, Suriname, Argentina, Chile, Australia, Papua New Guinea, Ecuador, Fiji, and Ghana. The company was founded in 1916 and is headquartered in Denver, Colorado.

About Triple Flag Precious Metals

Triple Flag Precious Metals Corp., a precious-metals-focused streaming and royalty company, engages in acquiring and managing precious metals, streams, royalties and other mineral interests in Australia, Canada, Colombia, Cote d'Ivoire, Honduras, Mexico, Mongolia, Peru, South Africa, the United States, and internationally. The company has a portfolio of streams and royalties providing exposure to gold, silver, nickel, copper, zinc, and lead. It holds a royalty interest in the Beta Hunt mine located in Pert, Wester Australia; the Camino Rojo gold and silver mine located in Mexico; the El Mochito polymetallic mine located in north-western Honduras; and La Colorada polymetallic mine located in Mexico. Triple Flag Precious Metals Corp. was founded in 2016 and is based in Toronto, Canada.