Zacks Investment Research downgraded shares of Rio Tinto plc (RIO) from OUTPERFORM to NEUTRAL on March 14, 2014, with a target price of $54.00.
We are downgrading our recommendation on Rio Tinto to Neutral based on a falling commodity price environment. In 2013, reduced commodity prices hampered earnings by $1.03 billion. While the prices of iron ore increased, coal, copper and aluminium prices decreased year over year. Rio operates in a highly competitive market with high market share companies, which makes it all the more difficult for Rio to cope with the price pressures. With such high investments in assets, a write-down of the same impacts the company. However, Rio Tinto reported strong results for 2013, with underlying earnings per ADR increasing 10.4% year over year to $5.53. Revenues for the year increased marginally to $51.2 billion. The company has been hiving off its unproductive assets to focus on the more profitable ones.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
To get a free copy of the research report on Rio Tinto plc (RIO),
click here.
For more information about research offerings from Zacks Investment Research, visit
Zacks.com .
Be the first to comment