Gatos Silver (NYSE:GATO – Get Free Report) and New Found Gold (NYSE:NFGC – Get Free Report) are both small-cap basic materials companies, but which is the better investment? We will compare the two companies based on the strength of their dividends, institutional ownership, valuation, risk, analyst recommendations, earnings and profitability.
Insider & Institutional Ownership
44.8% of Gatos Silver shares are held by institutional investors. Comparatively, 3.4% of New Found Gold shares are held by institutional investors. 3.8% of Gatos Silver shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Valuation & Earnings
This table compares Gatos Silver and New Found Gold”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Gatos Silver | N/A | N/A | $12.86 million | $0.49 | 28.20 |
| New Found Gold | N/A | N/A | -$59.18 million | ($0.22) | -7.09 |
Analyst Ratings
This is a summary of recent ratings for Gatos Silver and New Found Gold, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Gatos Silver | 0 | 4 | 0 | 1 | 2.40 |
| New Found Gold | 0 | 0 | 1 | 0 | 3.00 |
Gatos Silver presently has a consensus price target of $12.90, indicating a potential downside of 6.66%. New Found Gold has a consensus price target of $9.00, indicating a potential upside of 476.92%. Given New Found Gold’s stronger consensus rating and higher probable upside, analysts plainly believe New Found Gold is more favorable than Gatos Silver.
Profitability
This table compares Gatos Silver and New Found Gold’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Gatos Silver | N/A | 10.37% | 9.94% |
| New Found Gold | N/A | -82.80% | -68.88% |
Volatility and Risk
Gatos Silver has a beta of 1.93, meaning that its share price is 93% more volatile than the S&P 500. Comparatively, New Found Gold has a beta of 1, meaning that its share price has a similar volatility profile to the S&P 500.
Summary
Gatos Silver beats New Found Gold on 9 of the 12 factors compared between the two stocks.
About Gatos Silver
Gatos Silver, Inc. engages in the exploration, development, and production of precious metals. It primarily explores for silver deposits. The company also explores for zinc, lead, copper, and gold ores. Its flagship asset is the Los Gatos District, including the Cerro Los Gatos mine in Chihuahua, Mexico. The company was formerly known as Sunshine Silver Mining & Refining Corporation and changed its name to Gatos Silver, Inc. in October 2020. Gatos Silver, Inc. was incorporated in 2009 and is headquartered in Vancouver, Canada.
About New Found Gold
New Found Gold Corp., a mineral exploration company, engages in the identification, evaluation, acquisition, and exploration of mineral properties in the Provinces of Newfoundland and Labrador, and Ontario. It primarily explores for gold deposit. The company holds 100% interests in the Queensway project that includes 96 mineral licenses and 6,659 claims covering an area of 166,475 hectares of land located near Gander, Newfoundland; and the Kingsway project located in Gander, Newfoundland. The company was formerly known as Palisade Resources Corp. and changed its name to New Found Gold Corp. in June 2017. New Found Gold Corp. was incorporated in 2016 and is headquartered in Vancouver, Canada.
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