First Majestic Silver (AG) vs. Osisko gold royalties (OR) Financial Analysis

First Majestic Silver (NYSE: OR) and Osisko gold royalties (NYSE:OR) are both small-cap basic materials companies, but which is the superior business? We will compare the two companies based on the strength of their institutional ownership, earnings, profitability, analyst recommendations, dividends, valuation and risk.

Institutional and Insider Ownership

25.9% of First Majestic Silver shares are owned by institutional investors. Comparatively, 48.3% of Osisko gold royalties shares are owned by institutional investors. 0.9% of First Majestic Silver shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Dividends

Osisko gold royalties pays an annual dividend of $0.15 per share and has a dividend yield of 2.0%. First Majestic Silver does not pay a dividend. Osisko gold royalties pays out 107.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Valuation and Earnings

This table compares First Majestic Silver and Osisko gold royalties’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
First Majestic Silver $252.29 million 4.19 -$53.27 million ($0.04) -136.50
Osisko gold royalties $164.41 million 7.05 -$32.78 million $0.14 53.00

Osisko gold royalties has lower revenue, but higher earnings than First Majestic Silver. First Majestic Silver is trading at a lower price-to-earnings ratio than Osisko gold royalties, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings for First Majestic Silver and Osisko gold royalties, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
First Majestic Silver 0 1 4 0 2.80
Osisko gold royalties 0 0 2 0 3.00

First Majestic Silver presently has a consensus target price of $8.92, indicating a potential upside of 63.31%. Osisko gold royalties has a consensus target price of $20.00, indicating a potential upside of 169.54%. Given Osisko gold royalties’ stronger consensus rating and higher possible upside, analysts plainly believe Osisko gold royalties is more favorable than First Majestic Silver.

Profitability

This table compares First Majestic Silver and Osisko gold royalties’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
First Majestic Silver -39.42% -4.40% -3.07%
Osisko gold royalties -12.42% 0.97% 0.76%

Volatility and Risk

First Majestic Silver has a beta of 0.01, meaning that its share price is 99% less volatile than the S&P 500. Comparatively, Osisko gold royalties has a beta of 0.22, meaning that its share price is 78% less volatile than the S&P 500.

Summary

Osisko gold royalties beats First Majestic Silver on 12 of the 16 factors compared between the two stocks.

First Majestic Silver Company Profile

First Majestic Silver Corp. engages in the acquisition, exploration, development, and production of mineral properties with a focus on silver production in Mexico. It owns and operates six silver producing mines, including the Santa Elena Silver/Gold Mine covering an area of 101,837 hectares located in Sonora; La Encantada Silver Mine covering an area of 4,076 hectares situated in Coahuila; La Parrilla Silver Mine covering an area of 69,478 hectares located in Durango; Del Toro Silver Mine covering an area of 2,159 hectares situated in Zacatecas; San Martin Silver Mine covering an area of 38,512 hectares located in Jalisco; and La Guitarra Silver Mine that consists of 39,714 hectares situated in México State. The company was formerly known as First Majestic Resource Corp. and changed its name to First Majestic Silver Corp. in November 2006. First Majestic Silver Corp. was founded in 1979 and is headquartered in Vancouver, Canada.

Osisko gold royalties Company Profile

Osisko Gold Royalties Ltd acquires and manages precious metal and other royalties, streams, and similar interests in Canada and internationally. Its assets include the 5% net smelter return (NSR) royalty on the Canadian Malartic mine; the 2.0% to 3.5% NSR royalty on the Eleonore mine; a 9.6% diamond stream on the Renard diamond mine; a 4% gold and silver stream on the Brucejack gold and silver mine; and a silver stream on the Gibraltar mine, all located in Canada. The company also has a 100% silver stream on the Mantos Blancos copper mine in Chile. It holds a portfolio of approximately 130 royalties, streams, and precious metal offtakes in North America; and owns rights to participate in future royalty/stream financings on various projects primarily in Canada. Osisko Gold Royalties Ltd is headquartered in Montreal, Canada.

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