Wednesday, February 3, 2010

Rio Tinto (NYSE:RTP) Upgraded by Citigroup (NYSE:C)

Rio Tinto

Rio Tinto (NYSE:RTP) received some more good news as Citigroup (NYSE:C) upgraded the stock from hold to buy, based on prices of iron ore increasing at the company and more attractive valuations.

With Rio Tinto increasing its reserves through selling off some of its assets, it has strengthened their balance sheet and provided more opportunities for expansion organically or through acquisitions, some of the things Citigroup considered when upgrading the company.

For those with long term horizons, Rio Tinto looks like it could indeed be a buy, and it seems its tougher days are behind it and it has cash available to not only make acquisitions of quality companies, but also to grow organically with projects especially in the early stages of development but with solid growth potential.

One final factor for raising upgrading Rio Tinto is Citigroup believes copper prices could rise as high as $3.34 a pound from the $2.91 a pound it stands at today, with estimated prices of iron ore fines projected to rise up to 40 percent.

Rio Tinto

No comments: