Rio Tinto: defensive play on sector re-rating, Credit Suisse
(CercleFinance.com) - After a period when it suspended the stock's rating, on Monday Credit Suisse confirmed its buy ("outperform") rating on the Australian and British mining group, Rio Tinto.
According to analysts, this is “a defensive way to benefit from the sector re-rating”. They have a target price of 4,300 pence for the share.
Rio Tinto has performed significantly better than its competitors in the turnaround of the commodity cycle, between 2011 and 2015, both regarding savings and deleveraging.
With balance sheets across the sector now largely back to conservative levels, Rio shares should continue to outperform, “offering the generalist investor a defensive way to benefit from the sector re-rating we see ahead in steel and mining,” the broker points out.
Finally, Rio Tinto's valuation is considered "conservative," trading at a spot EV/EBITDA of 5x.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
According to analysts, this is “a defensive way to benefit from the sector re-rating”. They have a target price of 4,300 pence for the share.
Rio Tinto has performed significantly better than its competitors in the turnaround of the commodity cycle, between 2011 and 2015, both regarding savings and deleveraging.
With balance sheets across the sector now largely back to conservative levels, Rio shares should continue to outperform, “offering the generalist investor a defensive way to benefit from the sector re-rating we see ahead in steel and mining,” the broker points out.
Finally, Rio Tinto's valuation is considered "conservative," trading at a spot EV/EBITDA of 5x.
Copyright (c) 2018 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.