Critical Survey: Exxaro Resources (OTCMKTS:EXXAY) and Lithium Americas (Argentina) (NYSE:LAAC)

Exxaro Resources (OTCMKTS:EXXAY) and Lithium Americas (Argentina) (NYSE:LAAC) are both oils/energy companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, risk, dividends, institutional ownership, earnings, profitability and valuation.

Earnings and Valuation

This table compares Exxaro Resources and Lithium Americas (Argentina)”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Exxaro Resources	$1.78 billion	1.63	$679.76 million	N/A	N/A
Lithium Americas (Argentina)	N/A	N/A	$1.29 billion	$7.79	0.35

Lithium Americas (Argentina) has lower revenue, but higher earnings than Exxaro Resources.

Volatility & Risk

Exxaro Resources has a beta of 0.93, suggesting that its share price is 7% less volatile than the S&P 500. Comparatively, Lithium Americas (Argentina) has a beta of 1.35, suggesting that its share price is 35% more volatile than the S&P 500.

Profitability

This table compares Exxaro Resources and Lithium Americas (Argentina)’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Exxaro Resources	N/A	N/A	N/A
Lithium Americas (Argentina)	N/A	-1.37%	-1.08%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Exxaro Resources and Lithium Americas (Argentina), as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Exxaro Resources	0	0	0	0	0.00
Lithium Americas (Argentina)	0	3	3	1	2.71

Lithium Americas (Argentina) has a consensus target price of $7.19, suggesting a potential upside of 162.80%. Given Lithium Americas (Argentina)’s stronger consensus rating and higher probable upside, analysts clearly believe Lithium Americas (Argentina) is more favorable than Exxaro Resources.

Institutional and Insider Ownership

49.2% of Lithium Americas (Argentina) shares are held by institutional investors. 19.8% of Lithium Americas (Argentina) shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Lithium Americas (Argentina) beats Exxaro Resources on 8 of the 11 factors compared between the two stocks.

About Exxaro Resources

Exxaro Resources Limited engages in coal, iron ore investment, pigment manufacturing, renewable energy, and residual base metal businesses in South Africa, Europe, the United States, and Australia. The company operates through Coal; Ferrous; Energy; and Other segments. It produces thermal coal, metallurgical coal, and semi-soft coking coal products primarily in the Waterberg and Mpumalanga regions; offers gas-atomised ferrosilicon for use in separation plants, as well as iron ore; and operates two wind farms. The company was formerly known as Kumba Iron Ore Limited and changed its name to Exxaro Resources Limited in November 2006. The company is based in Pretoria, South Africa.

About Lithium Americas (Argentina)

Lithium Americas (Argentina) Corp. operates as a resource company. The company explores for lithium deposits. The company owns interests in the Cauchari-Olaroz project located in Jujuy province of Argentina. It also has a pipeline of development and exploration stage projects, including the Pastos Grandes project and the Sal de la Puna project located in Salta Province in northwestern Argentina. Lithium Americas (Argentina) Corp. is headquartered in Vancouver, Canada.