Stock price when the opinion was issued
If you believe that the iron price doesn't fall further, then a pretty decent buy here. For those who believe in his natural resource thesis over 5 years, you have to own it. Need to pay attention to the global economy, but especially the Chinese economy.
He's less concerned about 20% fluctuations in the stock price over time, and more concerned about long-term value and the sustainability of the dividend.
Offering diversification globally into materials such as iron ore, aluminum, copper and lithium, we reiterate RIO as a TOP PICK. Analysts expect their copper production will grow over 30% over the next 3 years. It trades at 10x earnings, under 2x book and supports a ROE of 20%. The robust dividend is backed by a payout ratio under 60% of cash flow. We continue to recommend a stop at $58, looking to achieve $81 — upside over 25%. Yield 5.9%
(Analysts’ price target is $81.13)