Morgans likes the acquisition of a 45% stake in the Sierra Gorda copper mine in Chile. This adds copper and molybdenum into what is already considered a highly diversified business.
The analyst also approves of the price, being a -US$1.6bn upfront cash payment and -US$500m in price/production linked payments. The broker retains its Hold rating (acquisition not yet included in forecasts, awaiting conditions precedent).
The target price is adjusted to $3.74 from $3.65.
Sector: Materials.
Target price is $3.74.Current Price is $3.82. Difference: ($0.08) – (brackets indicate current price is over target). If S32 meets the Morgans target it will return approximately -2% (excluding dividends, fees and charges – negative figures indicate an expected loss).
