Financial Analysis: USA Rare Earth (NASDAQ:USAR) vs. Eldorado Gold (NYSE:EGO)

USA Rare Earth (NASDAQ:USAR – Get Free Report) and Eldorado Gold (NYSE:EGO – Get Free Report) are both mid-cap materials companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, risk, institutional ownership, profitability, earnings, dividends and valuation.

Earnings and Valuation

This table compares USA Rare Earth and Eldorado Gold”s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
USA Rare Earth $1.64 million 1,683.20 -$297.56 million ($2.43) -4.64
Eldorado Gold $1.82 billion 5.27 $507.26 million $2.82 12.99

Eldorado Gold has higher revenue and earnings than USA Rare Earth. USA Rare Earth is trading at a lower price-to-earnings ratio than Eldorado Gold, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

69.6% of Eldorado Gold shares are held by institutional investors. 9.1% of USA Rare Earth shares are held by company insiders. Comparatively, 0.6% of Eldorado Gold shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent ratings and target prices for USA Rare Earth and Eldorado Gold, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
USA Rare Earth 1 0 10 0 2.82
Eldorado Gold 0 7 6 2 2.67

USA Rare Earth presently has a consensus price target of $33.71, indicating a potential upside of 198.89%. Eldorado Gold has a consensus price target of $46.57, indicating a potential upside of 27.10%. Given USA Rare Earth’s stronger consensus rating and higher possible upside, equities analysts plainly believe USA Rare Earth is more favorable than Eldorado Gold.

Profitability

This table compares USA Rare Earth and Eldorado Gold’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
USA Rare Earth N/A -9.04% -7.13%
Eldorado Gold 29.83% 10.91% 7.07%

Risk and Volatility

USA Rare Earth has a beta of 2.66, suggesting that its stock price is 166% more volatile than the S&P 500. Comparatively, Eldorado Gold has a beta of 0.67, suggesting that its stock price is 33% less volatile than the S&P 500.

Summary

Eldorado Gold beats USA Rare Earth on 8 of the 14 factors compared between the two stocks.

About USA Rare Earth

(Get Free Report)

USA Rare Earth, Inc. is domestic supplier of rare earth magnets and heavy rare earth elements. It is developing a vertically integrated, domestic supply chain for rare earth element magnet production, with a facility in Stillwater, Oklahoma, and mining rights to the Round Top heavy rare earth and critical minerals deposit in West Texas. The company was founded in May 2019 and is headquartered in Stillwater, OK.

About Eldorado Gold

(Get Free Report)

Eldorado Gold Corporation, together with its subsidiaries, engages in the mining, exploration, development, and sale of mineral products primarily in Turkey, Canada, Greece, and Romania. The company primarily produces gold, as well as silver, lead, and zinc. It holds a 100% interest in the Kisladag and Efemçukuru mines located in Turkey; Lamaque complex located in Canada; and Olympias, Stratoni, Skouries, Perama Hill, and Sapes gold mines located in Greece, as well as the 80.5% interest in Certej development projects located in Romania. The company was formerly known as Eldorado Corporation Ltd. and changed its name to Eldorado Gold Corporation in April 1996. Eldorado Gold Corporation was incorporated in 1996 and is headquartered in Vancouver, Canada.

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