Analyst Chris LaFemina from Jefferies reiterated a Buy rating on Anglo American (AAUKF – Research Report) and keeping the price target at p2,850.00.
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Chris LaFemina has given his Buy rating due to a combination of factors surrounding Anglo American’s strategic business maneuvers. The recent announcement of Anglo American’s sale of its nickel business to MMG Singapore Resources Pte. Ltd. is viewed positively despite the sale price being below the current book value. This is because it addresses the existing uncertainty in the nickel market and provides immediate cash inflow, thus strengthening the company’s financial position.
Furthermore, the upfront cash payment and potential additional earnings from this transaction are expected to bolster Anglo’s cash reserves, which aligns with their broader restructuring efforts. The progress in divesting non-core assets like the nickel business is considered a positive step for Anglo American, setting the stage for a more focused business model. This restructuring is anticipated to enhance the company’s appeal as a standalone entity or as an acquisition target, supporting the Buy rating and making Anglo American one of the top picks in the global mining sector.
In another report released on February 11, Barclays also maintained a Buy rating on the stock with a £28.80 price target.