Bank of America Securities analyst Jason Fairclough maintained a Buy rating on Rio Tinto (RIO – Research Report) today and set a price target of p7,500.00.
Jason Fairclough has given his Buy rating due to a combination of factors including Rio Tinto’s current valuation and market position. The company trades at approximately 0.7 times its price to net present value, which provides an attractive entry point for investors, especially given the positive outlook on commodities like Aluminium and Copper. Additionally, Fairclough suggests that the market may be overly pessimistic about iron ore, which could present further upside potential.
Another factor contributing to the Buy rating is the company’s dual-listed company (DLC) structure, which, according to rigorous reviews by the board, remains efficient and beneficial for shareholders. The board has advised against unification, as it may not serve the best interests of shareholders, particularly given the potential tax costs and share price impacts. The current structure also maintains flexibility for mergers and acquisitions, which is seen as advantageous for the company’s strategic growth.
In another report released on March 19, HSBC also maintained a Buy rating on the stock with a £56.50 price target.
Based on the recent corporate insider activity of 53 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of RIO in relation to earlier this year.