Searchlight Minerals (OTCMKTS:SRCH) and New Gold (NYSE:NGD) Critical Survey

New Gold (NYSE:NGD) and Searchlight Minerals (OTCMKTS:SRCH) are both basic materials companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, earnings, analyst recommendations, risk and valuation.

Volatility & Risk

New Gold has a beta of 1.35, suggesting that its stock price is 35% more volatile than the S&P 500. Comparatively, Searchlight Minerals has a beta of -0.05, suggesting that its stock price is 105% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for New Gold and Searchlight Minerals, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
New Gold	0	1	5	2	3.13
Searchlight Minerals	0	0	0	0	0.00

New Gold presently has a consensus target price of $3.66, indicating a potential upside of 1.10%. Given New Gold’s stronger consensus rating and higher possible upside, analysts plainly believe New Gold is more favorable than Searchlight Minerals.

Valuation and Earnings

This table compares New Gold and Searchlight Minerals”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
New Gold	$924.50 million	3.10	-$64.50 million	$0.13	27.85
Searchlight Minerals	N/A	N/A	-$2.28 million	N/A	N/A

Searchlight Minerals has lower revenue, but higher earnings than New Gold.

Insider & Institutional Ownership

42.8% of New Gold shares are held by institutional investors. 0.2% of New Gold shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares New Gold and Searchlight Minerals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
New Gold	11.10%	13.70%	6.31%
Searchlight Minerals	N/A	N/A	N/A

Summary

New Gold beats Searchlight Minerals on 11 of the 12 factors compared between the two stocks.

About New Gold

New Gold Inc., an intermediate gold mining company, develops and operates of mineral properties in Canada. It primarily explores for gold, silver, and copper deposits. The company’s principal operating properties include 100% interest in the Rainy River mine located in Northwestern Ontario, Canada; and New Afton project situated in South-Central British Columbia. New Gold Inc. is headquartered in Toronto, Canada.

About Searchlight Minerals

Searchlight Minerals Corp., an exploration stage company, engages in a slag reprocessing project; and the acquisition and exploration of mineral properties in the United States. It holds interests in the Clarkdale slag project, located in Clarkdale, Arizona, which is a reclamation project to recover precious and base metals from the reprocessing of slag produced from the smelting of copper ore mined at the United Verde Copper Mine in Jerome, Arizona. The company was formerly known as Phage Genomics, Inc and changed its name to Searchlight Minerals Corp. in June 2005. Searchlight Minerals Corp. was founded in 1999 and is based in Henderson, Nevada.