Contrasting Gold Royalty (NYSE:GROY) & Alamos Gold (NYSE:AGI)

Alamos Gold (NYSE:AGI) and Gold Royalty (NYSE:GROY) are both basic materials companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, valuation, earnings, dividends, institutional ownership, risk and analyst recommendations.

Profitability

This table compares Alamos Gold and Gold Royalty’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Alamos Gold	17.73%	8.52%	6.26%
Gold Royalty	-381.76%	-0.53%	-0.40%

Insider & Institutional Ownership

64.3% of Alamos Gold shares are owned by institutional investors. Comparatively, 33.8% of Gold Royalty shares are owned by institutional investors. 0.5% of Alamos Gold shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Risk and Volatility

Alamos Gold has a beta of 1.18, suggesting that its share price is 18% more volatile than the S&P 500. Comparatively, Gold Royalty has a beta of 0.97, suggesting that its share price is 3% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Alamos Gold and Gold Royalty, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Alamos Gold	0	1	4	0	2.80
Gold Royalty	0	0	2	0	3.00

Alamos Gold currently has a consensus target price of $25.06, suggesting a potential upside of 19.06%. Gold Royalty has a consensus target price of $3.67, suggesting a potential upside of 140.44%. Given Gold Royalty’s stronger consensus rating and higher possible upside, analysts clearly believe Gold Royalty is more favorable than Alamos Gold.

Valuation and Earnings

This table compares Alamos Gold and Gold Royalty”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Alamos Gold	$1.12 billion	7.50	$210.00 million	$0.52	40.48
Gold Royalty	$3.05 million	84.54	-$26.76 million	($0.16)	-9.53

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

Summary

Alamos Gold beats Gold Royalty on 11 of the 14 factors compared between the two stocks.

About Alamos Gold

Alamos Gold Inc. engages in the acquisition, exploration, development, and extraction of precious metals in Canada and Mexico. The company primarily explores for gold deposits. It holds 100% interest in the Young-Davidson mine and Island Gold mine located in the Ontario, Canada; Mulatos mine located in the Sonora, Mexico; and Lynn Lake project situated in the Manitoba, Canada. The company also holds interest in the Quartz Mountain project located in the Oregon United states. Alamos Gold Inc. was founded in 2003 and is based in Toronto, Canada.

About Gold Royalty

Gold Royalty Corp., a precious metals-focused royalty company, provides financing solutions to the metals and mining industry. It focuses on acquiring royalties, streams, and similar interests at varying stages of the mine life cycle to build a portfolio offering near, medium, and longer-term returns for its investors. Gold Royalty Corp. was incorporated in 2020 and is headquartered in Vancouver, Canada.