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Morgan Stanley has upgraded to “overweight” from “equal-weight”, with the target price raised to 4,000p from 3,540p. The broker thinks Rio Tinto is restoring the operating and investment disciplines that guided it through the decades before the supercycle, with cash flow accelerating.
Citi has downgraded to “sell” from “buy”, and cut the target price to 2,175p from 3,650p. With a new entrant into the online classified market on the way, Citi says the market may underestimate the scale of the threat to short-term earnings and longer-term pricing power and margins.