Financial Analysis: Freeport-McMoRan (NYSE:FCX) and 5N Plus (OTCMKTS:FPLSF)

Freeport-McMoRan (NYSE:FCX) and 5N Plus (OTCMKTS:FPLSF) are both basic materials companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, valuation, risk, analyst recommendations and dividends.

Analyst Ratings

This is a summary of current recommendations and price targets for Freeport-McMoRan and 5N Plus, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Freeport-McMoRan	0	7	8	3	2.78
5N Plus	0	0	0	0	0.00

Freeport-McMoRan currently has a consensus target price of $50.71, suggesting a potential upside of 12.09%. Given Freeport-McMoRan’s stronger consensus rating and higher probable upside, research analysts plainly believe Freeport-McMoRan is more favorable than 5N Plus.

Insider & Institutional Ownership

80.8% of Freeport-McMoRan shares are owned by institutional investors. Comparatively, 0.1% of 5N Plus shares are owned by institutional investors. 0.8% of Freeport-McMoRan shares are owned by insiders. Comparatively, 3.9% of 5N Plus shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Freeport-McMoRan and 5N Plus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Freeport-McMoRan	7.11%	7.03%	3.68%
5N Plus	6.94%	18.49%	6.92%

Risk & Volatility

Freeport-McMoRan has a beta of 1.64, suggesting that its share price is 64% more volatile than the S&P 500. Comparatively, 5N Plus has a beta of 1.84, suggesting that its share price is 84% more volatile than the S&P 500.

Earnings & Valuation

This table compares Freeport-McMoRan and 5N Plus”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Freeport-McMoRan	$25.46 billion	2.55	$1.89 billion	$1.21	37.39
5N Plus	$289.28 million	2.63	$14.67 million	$0.24	35.63

Freeport-McMoRan has higher revenue and earnings than 5N Plus. 5N Plus is trading at a lower price-to-earnings ratio than Freeport-McMoRan, indicating that it is currently the more affordable of the two stocks.

Summary

Freeport-McMoRan beats 5N Plus on 10 of the 15 factors compared between the two stocks.

About Freeport-McMoRan

Freeport-McMoRan Inc. engages in the mining of mineral properties in North America, South America, and Indonesia. It primarily explores for copper, gold, molybdenum, silver, and other metals. The company's assets include the Grasberg minerals district in Indonesia; Morenci, Bagdad, Safford, Sierrita, and Miami in Arizona; Chino and Tyrone in New Mexico; and Henderson and Climax in Colorado, North America, as well as Cerro Verde in Peru and El Abra in Chile. The company was formerly known as Freeport-McMoRan Copper & Gold Inc. and changed its name to Freeport-McMoRan Inc. in July 2014. Freeport-McMoRan Inc. was incorporated in 1987 and is headquartered in Phoenix, Arizona.

About 5N Plus

5N Plus Inc. produces and sells specialty metals and chemicals in North America, Europe, and Asia. It operates through two segments, Specialty Semiconductors and Performance Materials. The company offers semiconductor compounds, semiconductor wafers, metals, epitaxial semiconductor substrates, and solar cells. It also provides active pharmaceutical ingredients, animal feed additives, specialized chemicals, commercial grade metals, alloys, engineered powders, and recycling services. The company serves renewable energy, security, space, pharmaceutical, medical imaging, manufacturing, electronic, consumer, and industrial application markets. 5N Plus Inc. is headquartered in Montreal, Canada.