Rio Tinto (RIO – Research Report), the Basic Materials sector company, was revisited by a Wall Street analyst yesterday. Analyst Jason Fairclough from Bank of America Securities reiterated a Buy rating on the stock and has a p7,300.00 price target.
Jason Fairclough’s rating is based on Rio Tinto’s strategic positioning and operational resilience. Despite a lighter than expected Q1 iron ore production due to cyclones, the company has maintained its guidance across all commodities, showcasing its ability to manage and mitigate disruptions. The performance at the Oyu Tolgoi mine is improving, with the underground mine ramping up, which is expected to significantly boost copper production. Additionally, Rio Tinto’s investments in lithium, particularly through the Rincon project and the acquisition of Arcadium assets, position the company well in the growing market for future-facing commodities.
Furthermore, Rio Tinto’s Pilbara iron ore operations continue to be highly profitable, and the company is on track with its Simandou and Pilbara replacement projects. The stock is trading at a favorable valuation, offering exposure to the bullish trends in aluminum and copper. These factors, combined with the company’s strategic growth initiatives in copper and lithium, underpin Fairclough’s Buy rating for Rio Tinto.
In another report released today, Goldman Sachs also maintained a Buy rating on the stock with a p7,100.00 price target.
RIO’s price has also changed moderately for the past six months – from p5039.000 to p4353.000, which is a -13.61% drop .