Rio Tinto (RIO) AI Stock Analysis

• Market Cap: $104.57B
• Dividend Yield: 6.79%
• Average Volume (3M): 3.10M
• Price to Earnings (P/E): 9.0
• Beta (1Y): 0.82
• Revenue Growth: -0.81%
• EPS Growth: 14.59%
• Country: US
• Employees: 57,000
• Sector: Basic Materials
• Sector Strength: 56
• Industry: Mining
• EPS (TTM): 7.08
• Shares Outstanding: 1,253,972,000
• 10 Day Avg. Volume: 3,503,706
• 30 Day Avg. Volume: 3,096,827
• PEG Ratio: 0.62
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.49
• Price to Cash Flow (P/CF): N/A
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $82.16
• Price Target Upside: 31.86% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5

Rio Tinto shows a stable financial performance with strong profitability and a solid balance sheet, albeit facing challenges in revenue growth and cash flow conversion. Technical indicators point to potential short-term volatility, but the stock's valuation is attractive with a low P/E ratio and high dividend yield. Continued focus on cost management and cash flow improvement will be crucial moving forward.

Rio Tinto Business Overview & Revenue Model

Company Description

Rio Tinto (RIO) is a leading global mining group engaged in the exploration, mining, and processing of mineral resources. The company's operations focus on the production of a diverse range of minerals and metals, including aluminum, copper, diamonds, gold, industrial minerals, iron ore, and uranium. Headquartered in London, United Kingdom, and Melbourne, Australia, Rio Tinto operates through a network of fully integrated facilities and joint ventures across various continents, enabling it to supply essential materials that drive economic development and contribute to advancing human progress.

How the Company Makes Money

Rio Tinto makes money primarily through the extraction, processing, and sale of minerals and metals. The company's revenue model is centered around several key products, including iron ore, aluminum, and copper, which are among the most significant contributors to its earnings. Iron ore, in particular, is a major revenue driver due to its use in steel production, with Rio Tinto benefiting from its extensive mining operations in the Pilbara region of Western Australia. The company also generates revenue from aluminum production, supported by its vertically integrated business model encompassing bauxite mining, alumina refining, and aluminum smelting. Copper is another vital revenue stream, with operations in key mining regions such as Chile and the United States. Additionally, Rio Tinto's strategic partnerships and joint ventures, such as those with Chinese companies, enhance its market presence and contribute to its financial performance. The company is also focused on sustainable and responsible mining practices, aiming to create value for its shareholders while adhering to environmental and social governance standards.

Rio Tinto Financial Statement Overview

Summary

Overall, Rio Tinto's financials present a stable outlook with strong profitability margins and an excellent balance sheet. The company faces challenges in revenue growth and cash flow conversion, yet its operational efficiency and capital structure remain commendable. Continued focus on cost management and cash flow improvement will be key to sustaining financial strength.

Income Statement

Rio Tinto has shown a mixed performance in its recent income statements. The Gross Profit Margin improved in 2024, reaching 56.43% from 32.01% in 2023, indicating better cost management. However, the Net Profit Margin saw a slight decline from 18.61% in 2023 to 21.53% in 2024. The Revenue Growth Rate was negative at -0.71% from 2023 to 2024, showing a slight contraction in sales. Despite these challenges, EBIT and EBITDA margins remain strong at 29.17% and 43.16% respectively, showcasing operational efficiency.

Balance Sheet

Rio Tinto maintains a solid balance sheet with a healthy Equity Ratio of 53.73% in 2024, reflecting strong capitalization. The Debt-to-Equity Ratio improved to 0.25 from 0.26, indicating effective management of liabilities. Return on Equity is robust at 20.91%, a slight increase from 18.43% in 2023, highlighting the company's ability to generate returns for its shareholders.

Cash Flow

The cash flow position of Rio Tinto shows some areas of concern. Free Cash Flow decreased by 25.95% from 2023 to 2024, but operating cash flow remains stable. The Operating Cash Flow to Net Income Ratio is strong at 1.35, indicating good cash generation relative to net profits. However, the Free Cash Flow to Net Income Ratio fell to 0.52, suggesting reduced cash conversion efficiency.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
53.66B	54.04B	55.55B	63.49B	44.61B
	Gross Profit
30.28B	17.30B	34.27B	44.93B	29.13B
	EBIT
15.65B	14.82B	19.93B	29.82B	16.83B
	EBITDA
22.31B	20.38B	24.76B	35.08B	19.66B
	Net Income Common Stockholders
11.55B	10.06B	12.39B	21.11B	9.77B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
7.20B	10.79B	8.94B	15.35B	13.23B
	Total Assets
102.79B	103.55B	96.74B	102.90B	97.39B
	Total Debt
13.86B	14.35B	12.27B	13.53B	14.02B
	Net Debt
7.03B	4.68B	5.50B	724.00M	3.63B
	Total Liabilities
44.82B	47.21B	44.47B	46.31B	45.49B
	Stockholders Equity
55.25B	54.59B	50.17B	51.43B	47.05B
Cash Flow		Free Cash Flow
5.98B	8.07B	9.38B	17.96B	9.69B
	Operating Cash Flow
15.60B	15.16B	16.13B	25.34B	15.88B
	Investing Cash Flow
-9.59B	-6.96B	-6.71B	-7.16B	-6.56B
	Financing Cash Flow
-7.09B	-5.28B	-15.47B	-15.86B	-7.13B

Rio Tinto Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 62.31
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RIO, the sentiment is Positive. The current price of 62.31 is above the 20-day moving average (MA) of 60.44, above the 50-day MA of 58.93, and above the 200-day MA of 61.29, indicating a bullish trend. The MACD of 0.48 indicates Negative momentum. The RSI at 62.44 is Neutral, neither overbought nor oversold. The STOCH value of 41.38 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RIO.

Rio Tinto Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VALE	75 Outperform	$41.47B	7.13	16.72%	9.39%	-8.71%	-22.75%
BHP	74 Outperform	$125.09B	11.32	26.13%	5.70%	-3.15%	54.08%
SCCO	72 Outperform	$72.05B	21.07	40.71%	2.18%	15.54%	39.64%
FCX	71 Outperform	$54.15B	28.92	10.92%	1.59%	10.71%	1.94%
RIO	70 Outperform	$104.57B	8.98	20.93%	6.79%	-0.81%	14.59%
TECK.B	59 Neutral	C$28.14B	88.76	1.56%	0.92%	-10.03%	-86.30%
Sector *	47 Neutral	$2.64B	-4.00	-31.55%	3.33%	2.93%	-29.90%