Update shared on 07 Nov 2025
Fair value Increased 3.94%Analysts have raised their price target for Anglo American from approximately $28.36 to $29.48. They cite improved sentiment on future iron ore demand and ongoing sector consolidation as key drivers for the upward revision.
Analyst Commentary
Bullish Takeaways- Bullish analysts have revised price targets upward, citing improving sentiment around iron ore demand and increasing optimism for Chinese steel production potentially exceeding expectations.
- Confidence in growth prospects is supported by recent M&A activity, particularly the merger with Teck Resources. This positions the company as one of the largest copper producers globally and indicates potential for further industry consolidation.
- Upgrades to Buy ratings reflect a constructive outlook on valuation, supported by raised iron ore price forecasts through 2026.
- Some analysts acknowledge supply constraints, especially at significant projects such as Simandou in Guinea. These constraints could benefit pricing and support strategic positioning in the sector.
- Bearish analysts remain cautious, maintaining Neutral ratings despite increasing price targets and pointing to ongoing execution risks as the company integrates major acquisitions.
- There is concern that sector-wide consolidation may support value in the near term but could also increase operational complexity and competition over the long term.
- Skepticism persists regarding the sustainability of price recoveries in iron ore and copper, with macro uncertainty in key demand markets remaining a potential headwind.
What's in the News
- Anglo American is close to acquiring Canadian miner Teck Resources, with a deal potentially being announced as early as this week (Bloomberg reports).
- The company announced a plan to sell its remaining 19.9% stake in Valterra Platinum Limited after a strong rally in Valterra's shares. This move aims to strengthen its balance sheet.
- Anglo American has declared an intended special dividend of USD 4.5 billion to be paid to shareholders ahead of the completion of the Teck merger.
- Recent operating results show growth in manganese and diamond production, while steelmaking coal output declined significantly for the third quarter and year to date ended September 30, 2025.
- A definitive joint mine plan agreement was reached between Anglo American and Codelco to jointly operate adjacent copper mines in Chile. The collaboration aims to unlock 2.7 million tonnes of additional copper production over 21 years.
Valuation Changes
- Consensus Analyst Price Target has risen slightly from $28.36 to $29.48, reflecting improved sentiment and outlook.
- Discount Rate has increased from 8.65% to 9.40%, indicating a higher required return or perceived risk in future cash flows.
- Revenue Growth projection has improved slightly, with the expected contraction easing from negative 7.20% to negative 6.86%.
- Net Profit Margin has fallen from 11.08% to 10.42%, signaling a modest decrease in expected profitability.
- Future P/E ratio has climbed from 30.0x to 32.9x, suggesting that shares are now valued at a higher multiple of projected earnings.
Disclaimer
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