This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Citi Sees Benefit From Rio Tinto Shakeup

By The Associated Press

Citi analyst Heath Jansen upgraded his rating on mining giant Rio Tinto PLC, saying Thursday's company shakeup could help it in the long term.

THE OPINION: Rio Tinto CEO Tom Albanese and Doug Ritchie, another top executive, announced Thursday that they are stepping down immediately. This news came as the U.K. company announced a $14 billion write-down from its aluminum business and a a coal company in Mozambique. Ritchie led that acquisition.

Sam Walsh, head of Rio Tinto's iron ore division, will become CEO of the world's third-largest diversified mining company.

Jansen said that the market will likely see the write-downs and management changes negatively in the short term, but he believes the moves will be positive for the stock and the sector in the long term. He said the announcements could significantly realign Rio Tinto with shareholder interests through reduced spending on mergers and acquisitions and lower capital expenditures.

The analyst updated his take on its capital allocation and foreign exchange assumptions. As a result, he increased his target price to $64.03 from $52.82 and upgraded his rating on the stock to "Buy" from "Neutral".

THE STOCK: Shares or Rio Tinto traded on the New York Stock Exchange slipped 51 cents to $54.52 by early afternoon. They remain at the higher end of their 52-week trading range of $41.59 to $63.18.
Copyright 2011 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG

Markets

DOW 17,694.20 +74.69 0.42%
S&P 500 2,072.15 +9.04 0.44%
NASDAQ 5,000.9560 +14.0890 0.28%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs