Credit Suisse believes Rio Tinto is the clean way to play the steel cycle, as it offers exposure through its iron ore assets and the asset sales in coal have largely been completed.
The business is arguably better placed for growth opportunities, if and when they present and the broker also notes that the company has the strongest track record of capital returns among its peers.
Outperform and target raised to $89 from $82.
Target price is $89.00.Current Price is $82.63. Difference: $6.37 – (brackets indicate current price is over target). If RIO meets the Credit Suisse target it will return approximately 7% (excluding dividends, fees and charges – negative figures indicate an expected loss).