Rio Tinto is still a buy for the scribes at Jefferies as they believe consensus forecasts for this year are too low.
Full-year results this week were on track, said the US bank, with underlying profits higher than forecasts, earnings lower and the dividend at the top end of guidance.
Going forward, a cyclical recovery in earnings should lead to further outperformance in Rio shares believes Jefferies.
“There are obviously many risks and there will be occasional painful pullbacks along the way, but on our base case macro assumptions we would expect Rio’s share price to end the year well above where it is today.”
The bank's share price target is 7,500p compared to 5,874p today.