With Rio Tinto’s full year result mostly as Morgans expected, the focus now turns to operational and cost pressures on multiple fronts and stubbornly high capex. As a result a Hold rating is maintained, while the target price rises to $107 from $102.
While the company raised its payout ratio and delivered a US$4.79 final dividend, it was still shy of the analyst’s US$4.94 estimate, though consensus was for US$4.57.
Guidance points to some volume gains from iron ore and copper versus a material step up in opex, notes the broker.
Sector: Materials.
Target price is $107.00.Current Price is $119.87. Difference: ($12.87) – (brackets indicate current price is over target). If RIO meets the Morgans target it will return approximately -12% (excluding dividends, fees and charges – negative figures indicate an expected loss).
