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(Sharecast News) - Analysts at Berenberg lowered their target price on mining giant Rio Tinto from 5,800.0p to 5,700.0p on Wednesday following Q2 production results from the company.
Berenberg noted that Rio Tinto's Q2 production results resulted in the shares closing down roughly 2.3% on the day, driven by a guidance cut in alumina to 7.0m-7.3m tonnes due to gas supply issues, with mined copper production steered to the lower end of guidance at 660,000-720,000 tonnes and bauxite to the upper end at 53.0m-56.0m tonnes.
Iron ore production came in at 79.5m tonnes, a touch light versus Berenberg's 81.1m tonne estimate, with shipments of 80.3m tonnes a touch ahead of the German bank's 79.1m tonne estimate, as production and shipping at its Pilbara operations in Australia were affected by a train collision in mid-May
"We update our model for the Q2 production results and guidance changes, and make small adjustments to our estimates. This includes a slower-than-expected ramp-up of recycled aluminium production from Matalco, lower alumina volumes in H2 at its Gladstone operations (Australia), as well as higher H1 operating costs at its Pilbara operations. Our price target nudges lower to 5,700.0p per share and we remain hold-rated; the stock is trading on 0.92x NAV and 4.6x FY24 EBITDA," said Berenberg,
Reporting by Iain Gilbert at Sharecast.com
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