Head to Head Review: McEwen (NYSE:MUX) and Largo (NYSE:LGO)

McEwen (NYSE:MUX) and Largo (NYSE:LGO) are both small-cap materials companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, dividends, analyst recommendations, institutional ownership, valuation, risk and earnings.

Analyst Recommendations

This is a summary of recent recommendations for McEwen and Largo, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
McEwen	0	2	2	0	2.50
Largo	0	0	2	0	3.00

McEwen currently has a consensus target price of $29.50, suggesting a potential upside of 81.96%. Largo has a consensus target price of $2.10, suggesting a potential upside of 370.54%. Given Largo’s stronger consensus rating and higher possible upside, analysts plainly believe Largo is more favorable than McEwen.

Institutional and Insider Ownership

17.0% of McEwen shares are owned by institutional investors. Comparatively, 64.1% of Largo shares are owned by institutional investors. 14.8% of McEwen shares are owned by company insiders. Comparatively, 0.3% of Largo shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Earnings & Valuation

This table compares McEwen and Largo”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
McEwen	$197.55 million	5.04	$34.43 million	$1.26	12.87
Largo	$127.06 million	0.40	-$30.34 million	($1.07)	-0.42

McEwen has higher revenue and earnings than Largo. Largo is trading at a lower price-to-earnings ratio than McEwen, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares McEwen and Largo’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
McEwen	32.46%	13.48%	9.13%
Largo	-35.10%	-22.61%	-14.29%

Risk and Volatility

McEwen has a beta of 1.26, indicating that its stock price is 26% more volatile than the S&P 500. Comparatively, Largo has a beta of 1.5, indicating that its stock price is 50% more volatile than the S&P 500.

Summary

McEwen beats Largo on 9 of the 13 factors compared between the two stocks.

About McEwen

McEwen Mining Inc. engages in the exploration, development, production, and sale of gold and silver. It also explores for copper deposits. The company owns 100% interests in the El Gallo and Fenix projects located in Mexico; and the Black Fox Mine and Stock Mill, Grey Fox, and Froome and Tamarack properties in Canada. It also owns interests in the Fuller, Davidson-Tisdale, Buffalo Ankerite, and Paymaster exploration properties located in Canada; and a 49% interest in the San José mine located in Argentina. In addition, the company owns 100% interests in the Gold Bar and Tonkin properties located in Eureka County, Nevada; and interests in the Los Azules copper project located in the cordilleran region in the province of San Juan, Argentina. The company was formerly known as US Gold Corporation and changed its name to McEwen Mining Inc. in January 2012. McEwen Mining Inc. was founded in 1979 and is headquartered in Toronto, Canada.

About Largo

Largo Inc. engages in the development and sale of vanadium-based energy storage systems in Canada. The company operates through, Sales & Trading, Mine Properties, Corporate, Exploration and Evaluation Properties, and Largo Clean Energy and Largo Physical Vanadium Segments. Its products include VPURE+ vanadium flakes that are used in the production of master alloys and aerospace applications; VPURE vanadium flakes ferrovanadium and vanadium carbon nitride for the steel industry; and VPURE+ vanadium powder for catalyst applications. The company offers renewable energy storage solutions through Largo Clean Energy. Its products are sourced from vanadium deposits at the Maracás Menchen Mine in Brazil. The company was formerly known as Largo Resources Ltd. and changed its name to Largo Inc. in November 2021. The company was incorporated in 1988 and is headquartered in Toronto, Canada.