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UPDATE: Citigroup Upgrades Rio Tinto PLC to Buy on Management Changes, Valuation

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Citigroup upgraded Rio Tinto PLC (NYSE: RIO) from Neutral to Buy.

Citigroup noted, "We believe the market will perceive today's write-downs and management changes negatively in the short term, but that these will be positive for the stock and the sector longer term. One of our structural bearish criticisms of the sector has been poor capital allocation, and lack of shareholder focus. We believe today's announcement could significantly realign Rio Tinto with shareholder interests through reduced M&A and reduced capex spend. Due to today's impairments, we have removed the large discount to NPV we previously applied for poor capital allocation (we now apply a 15% discount vs. 40% previously)."

Rio Tinto PLC closed at $55.03 on Wednesday.

Latest Ratings for RIO

Oct 2016CitigroupDowngradesNeutralSell
Sep 2016CIBCUpgradesSector PerformerUnderperformer
Sep 2016JP MorganUpgradesNeutralOverweight

View More Analyst Ratings for RIO
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Posted-In: CitigroupAnalyst Color Upgrades Pre-Market Outlook Analyst Ratings


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