Government action in South Africa has led to Rio Tinto shutting down operations and developments there for three weeks. Quebec has called mining and smelting essential, but only at minimum rates. The broker has adjusted accordingly and also adjusted for commodity price and forex movements.
Target falls to $94.01 from $98.30. Add retained, as Rio has low gearing and minimal capex commitments and is a low-cost producer across many segments.
Sector: Materials.
Target price is $94.01.Current Price is $83.82. Difference: $10.19 – (brackets indicate current price is over target). If RIO meets the Morgans target it will return approximately 11% (excluding dividends, fees and charges – negative figures indicate an expected loss).
