Rio Tinto reflects attractive technical aspects that could allow investors to expect a trend reversal over the medium term.
Strengths
● The share is getting closer to its long-term support in weekly data, at GBp 3452.5, which offers good timing for buyers.
● Share prices are approaching a strong support area in daily data, which offers good timing for investors.
● The group's activity appears highly profitable thanks to its outperforming net margins.
● Thanks to a sound financial situation, the firm has significant leeway for investment.
● Its low valuation, with P/E ratio at 9.6 and 10.9 for the ongoing fiscal year and 2019 respectively, makes the stock pretty attractive with regard to earnings multiples.
● This company will be of major interest to investors in search of a high dividend stock.
● For the last twelve months, analysts have been gradually revising upwards their EPS forecast for the upcoming fiscal year.
● The difference between current prices and the average target price is rather important and implies a significant appreciation potential for the stock.
Weaknesses
● As estimated by analysts, this group is among those businesses with the lowest growth prospects.
● Sales estimates for the next fiscal years vary from one analyst to another. This clearly highlights a lack of visibility into the company's future activity.
● The company's earnings releases usually do not meet expectations.
● Revenue estimates are regularly revised downwards for the current and coming years.
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Rio Tinto plc is one of the world's leaders in mining research, prospecting and operating. Net sales break down by family of products as follows:
- iron ore (59%): 283.2 Mt produced in 2022;
- aluminum, alumina and bauxite (24.9%): 54.6 Mt bauxite, 7.5 Mt alumina and 3 Mt aluminum produced;
- copper (5.8%) : 521.1 Kt produced;
- industrial minerals (4.8%): titanium dioxide pigments (1,200 Kt produced), borates (532 Kt produced) and salts (5.7 Mt produced);
- diamonds (1.5%) : 4.7 million carats produced;
- gold (1%) : 235,000 ounces produced;
- other (3%): uranium, silver, zinc and molybdenum.
Net sales are distributed geographically as follows: the United Kingdom (0.3%), Europe (6.5%), China (54.3%), Japan (7.4%), Asia (7.1%), the United States (15.9%), Canada (3.1%), Australia (1.9%) and other (3.5%).