Gold Resource (NYSE:GORO) versus Centerra Gold (NYSE:CGAU) Head-To-Head Review

Gold Resource (NYSE:GORO) and Centerra Gold (NYSE:CGAU) are both small-cap basic materials companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, institutional ownership, analyst recommendations, dividends, valuation, earnings and profitability.

Profitability

This table compares Gold Resource and Centerra Gold’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Gold Resource	-61.31%	-35.25%	-16.15%
Centerra Gold	8.31%	10.34%	7.70%

Risk & Volatility

Gold Resource has a beta of 1.6, meaning that its stock price is 60% more volatile than the S&P 500. Comparatively, Centerra Gold has a beta of 0.89, meaning that its stock price is 11% less volatile than the S&P 500.

Institutional & Insider Ownership

18.4% of Gold Resource shares are held by institutional investors. Comparatively, 55.4% of Centerra Gold shares are held by institutional investors. 2.5% of Gold Resource shares are held by company insiders. Comparatively, 0.2% of Centerra Gold shares are held 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.

Earnings and Valuation

This table compares Gold Resource and Centerra Gold”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Gold Resource	$97.73 million	0.23	-$16.02 million	($0.49)	-0.48
Centerra Gold	$1.25 billion	0.97	-$81.28 million	$0.48	12.06

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

Analyst Ratings

This is a summary of recent ratings and recommmendations for Gold Resource and Centerra Gold, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Gold Resource	0	0	1	0	3.00
Centerra Gold	0	2	2	0	2.50

Gold Resource currently has a consensus price target of $1.75, indicating a potential upside of 636.84%. Centerra Gold has a consensus price target of $11.00, indicating a potential upside of 89.98%. Given Gold Resource’s stronger consensus rating and higher probable upside, analysts clearly believe Gold Resource is more favorable than Centerra Gold.

Summary

Centerra Gold beats Gold Resource on 9 of the 14 factors compared between the two stocks.

About Gold Resource

Gold Resource Corporation engages in the exploration, development, and production of gold and silver projects in Mexico and the United States. The company also explores for copper, lead, and zinc deposits. Its principal assets are the 100% owned Don David gold mine and Back Forty project covering approximately 1,304 hectares located in Menominee county, Michigan. The company was incorporated in 1998 and is headquartered in Denver, Colorado.

About Centerra Gold

Centerra Gold Inc., a gold mining company, engages in the acquisition, exploration, development, and operation of gold and copper properties in North America, Turkey, and internationally. The company explores for gold, copper, and molybdenum deposits. Its flagship projects are the 100% owned Mount Milligan gold-copper mine located in British Columbia, Canada; and the Öksüt gold mine located in Turkey. The company was incorporated in 2002 and is based in Toronto, Canada.