Financial Analysis: Avalon Rare Metals (OTCMKTS:AVLNF) and Hycroft Mining (NASDAQ:HYMC)

Hycroft Mining (NASDAQ:HYMC) and Avalon Rare Metals (OTCMKTS:AVLNF) are both small-cap basic materials companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, profitability, dividends, risk, valuation, analyst recommendations and institutional ownership.

Analyst Ratings

This is a summary of recent ratings and price targets for Hycroft Mining and Avalon Rare Metals, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hycroft Mining	1	0	0	0	1.00
Avalon Rare Metals	0	0	0	0	0.00

Risk & Volatility

Hycroft Mining has a beta of 2.71, indicating that its share price is 171% more volatile than the S&P 500. Comparatively, Avalon Rare Metals has a beta of -0.02, indicating that its share price is 102% less volatile than the S&P 500.

Valuation & Earnings

This table compares Hycroft Mining and Avalon Rare Metals”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hycroft Mining	$33.23 million	32.65	-$60.90 million	($1.62)	-8.27
Avalon Rare Metals	$40,000.00	677.32	-$3.72 million	N/A	N/A

Avalon Rare Metals has lower revenue, but higher earnings than Hycroft Mining.

Insider and Institutional Ownership

7.4% of Hycroft Mining shares are held by institutional investors. 1.3% of Hycroft Mining shares are held by company insiders. Comparatively, 2.4% of Avalon Rare Metals shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Hycroft Mining and Avalon Rare Metals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hycroft Mining	N/A	N/A	-27.55%
Avalon Rare Metals	-10,634.21%	-4.50%	-4.14%

Summary

Hycroft Mining beats Avalon Rare Metals on 6 of the 10 factors compared between the two stocks.

About Hycroft Mining

Hycroft Mining Holding Corporation, together with its subsidiaries, operates as a gold and silver development company in the United States. The company holds interests in the Hycroft mine that consists of 30 private parcels with patented claims comprising approximately 1,787 acres, and 3,247 unpatented mining claims that encompass approximately 62,298 acres located in the state of Nevada. Hycroft Mining Holding Corporation is based in Winnemucca, Nevada.

About Avalon Rare Metals

Avalon Advanced Materials Inc., together with its subsidiaries, engages in the acquisition, exploration, evaluation, and development of rare metal and mineral properties primarily in Canada. The company focuses on exploring lithium, tantalum, cesium, indium, gallium, germanium, tin, yttrium, and zirconium deposits, as well as rare earth elements. Its flagship project is the 100% owned Separation Rapids Lithium Project consisting of nineteen mineral claims and one mining lease covering an area of approximately 4,414 hectares located in the Paterson Lake Area, Kenora Mining Division, Ontario. The company was formerly known as Avalon Rare Metals Inc. and changed its name to Avalon Advanced Materials Inc. in February 2016. Avalon Advanced Materials Inc. is headquartered in Toronto, Canada.