Financial Analysis: Black Hawk Exploration (OTCMKTS:BHWX) & Franco-Nevada (NYSE:FNV)

Franco-Nevada (NYSE:FNV) and Black Hawk Exploration (OTCMKTS:BHWX) are both basic materials companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, profitability, valuation, analyst recommendations, dividends, earnings and risk.

Profitability

This table compares Franco-Nevada and Black Hawk Exploration’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Franco-Nevada	-55.28%	10.55%	10.09%
Black Hawk Exploration	N/A	N/A	N/A

Earnings & Valuation

This table compares Franco-Nevada and Black Hawk Exploration”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Franco-Nevada	$1.10 billion	20.29	-$466.40 million	($3.16)	-36.56
Black Hawk Exploration	N/A	N/A	N/A	N/A	N/A

Black Hawk Exploration has lower revenue, but higher earnings than Franco-Nevada.

Insider and Institutional Ownership

77.1% of Franco-Nevada shares are held by institutional investors. 0.7% of Franco-Nevada shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Franco-Nevada and Black Hawk Exploration, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Franco-Nevada	0	3	7	0	2.70
Black Hawk Exploration	0	0	0	0	0.00

Franco-Nevada presently has a consensus price target of $152.83, suggesting a potential upside of 32.28%. Given Franco-Nevada’s stronger consensus rating and higher probable upside, equities analysts plainly believe Franco-Nevada is more favorable than Black Hawk Exploration.

Summary

Franco-Nevada beats Black Hawk Exploration on 8 of the 9 factors compared between the two stocks.

About Franco-Nevada

Franco-Nevada Corporation operates as a gold-focused royalty and streaming company in South America, Central America, Mexico, the United States, Canada, and internationally. It operates through Mining and Energy segments. The company manages its portfolio with a focus on precious metals, such as gold, silver, and platinum group metals; and engages in the sale of crude oil, natural gas, and natural gas liquids through a third-party marketing agent. Franco-Nevada Corporation was founded in 1986 and is headquartered in Toronto, Canada.

About Black Hawk Exploration

Black Hawk Exploration (Black Hawk) is an exploration-stage company. The Company is engaged in the acquisition of and exploration of mining properties. It is a diversified energy and metals exploration company focused on identifying and exploring properties and developing new prospective projects globally. On December 8, 2009 the Company formed a wholly owned Nevada subsidiary, Golden Black Hawk, Inc.