LSE:RIO

Stock Analysis Report

Executive Summary

Rio Tinto Group engages in finding, mining, and processing mineral resources worldwide.

Snowflake

Fundamentals

Outstanding track record with excellent balance sheet and pays a dividend.


Similar Companies

Share Price & News

How has Rio Tinto Group's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

-5.9%

RIO

-3.2%

GB Metals and Mining

-0.4%

GB Market


1 Year Return

7.7%

RIO

1.4%

GB Metals and Mining

2.9%

GB Market

Return vs Industry: RIO exceeded the UK Metals and Mining industry which returned 1.4% over the past year.

Return vs Market: RIO exceeded the UK Market which returned 2.9% over the past year.


Shareholder returns

RIOIndustryMarket
7 Day-5.9%-3.2%-0.4%
30 Day-6.8%-5.6%-1.4%
90 Day-18.3%-12.8%-2.1%
1 Year21.0%7.7%9.9%1.4%7.9%2.9%
3 Year86.1%48.5%51.2%26.8%18.0%3.6%
5 Year83.5%31.5%47.1%20.0%35.8%6.4%

Price Volatility Vs. Market

How volatile is Rio Tinto Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Rio Tinto Group undervalued compared to its fair value and its price relative to the market?

27.1%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: RIO (£39.62) is trading below our estimate of fair value (£54.35)

Significantly Undervalued: RIO is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: RIO is good value based on its PE Ratio (6.3x) compared to the Metals and Mining industry average (8.8x).

PE vs Market: RIO is good value based on its PE Ratio (6.3x) compared to the UK market (16.7x).


Price to Earnings Growth Ratio

Low PEG Ratio: RIO's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: RIO is overvalued based on its PB Ratio (2.1x) compared to the GB Metals and Mining industry average (1x).


Next Steps

Future Growth

How is Rio Tinto Group forecast to perform in the next 1 to 3 years based on estimates from 23 analysts?

-3.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RIO's earnings are forecast to decline over the next 3 years (-3.8% per year).

Earnings vs Market: RIO's earnings are forecast to decline over the next 3 years (-3.8% per year).

High Growth Earnings: RIO's earnings are forecast to decline over the next 3 years.

Revenue vs Market: RIO's revenue is expected to decline over the next 3 years (-2.3% per year).

High Growth Revenue: RIO's revenue is forecast to decline over the next 3 years (-2.3% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: RIO's Return on Equity is forecast to be low in 3 years time (17.6%).


Next Steps

Past Performance

How has Rio Tinto Group performed over the past 5 years?

32.2%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: RIO's earnings have grown significantly by 32.2% per year over the past 5 years.

Accelerating Growth: RIO's earnings growth over the past year (36.1%) exceeds its 5-year average (32.2% per year).

Earnings vs Industry: RIO earnings growth over the past year (36.1%) exceeded the Metals and Mining industry 3.4%.


Return on Equity

High ROE: RIO's Return on Equity (27.9%) is considered high.


Return on Assets

ROA vs Industry: RIO has a higher Return on Assets than the Metals and Mining industry average last year.


Return on Capital Employed

ROCE Improving: RIO has significantly improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is Rio Tinto Group's financial position?


Financial Position Analysis

Short Term Liabilities: RIO's short term assets ($16.9B) exceeds its short term liabilities ($11.1B)

Long Term Liabilities: RIO's short term assets (16.9B) do not cover its long term liabilities (31.4B)


Debt to Equity History and Analysis

Debt Level: RIO's debt to equity ratio (29.3%) is considered satisfactory

Reducing Debt: RIO's debt to equity ratio has reduced from 45% to 29.3% over the past 5 years.

Debt Coverage: RIO's debt is well covered by operating cash flow (100.1%).

Interest Coverage: RIO's interest payments on its debt are well covered by EBIT (33.7x coverage).


Balance Sheet

Inventory Level: RIO has a high level of physical assets or inventory.

Debt Coverage by Assets: RIO's debt is covered by short term assets (assets are 1.300800x debt).


Next Steps

Dividend

What is Rio Tinto Group's current dividend yield, its reliability and sustainability?

6.21%

Current Dividend Yield


Dividend Yield vs Market

company6.2%marketbottom25%2.0%markettop25%5.4%industryaverage7.6%forecastin3Years7.0%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: RIO's dividend (6.21%) is higher than the bottom 25% of dividend payers in the UK market (2.01%).

High Dividend: RIO's dividend (6.21%) is in the top 25% of dividend payers in the UK market (5.36%)

Stable Dividend: RIO's dividend payments have been volatile in the past 10 years.

Growing Dividend: RIO's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (40.5%), RIO's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: RIO's dividends in 3 years are forecast to be covered by earnings (66.3% payout ratio).


Next Steps

Management

What is the CEO of Rio Tinto Group's salary, the management and board of directors tenure and is there insider trading?

2.8yrs

Average management tenure


CEO

J-S Jacques (48yo)

3.3yrs

Tenure

US$6,139,000

Compensation

Mr. Jean-Sébastien Jacques, M.Sc., has been the Chief Executive Officer of Rio Tinto plc, Rio Tinto Limited and Rio Tinto Group since July 2, 2016. Mr. Jacques served as the Deputy Chief Executive at Rio T ...


CEO Compensation Analysis

Compensation vs. Market: J-S's total compensation ($USD6.14M) is about average for companies of similar size in the UK market ($USD4.92M).

Compensation vs Earnings: J-S's compensation has increased by more than 20% in the past year.


Management Age and Tenure

2.8yrs

Average Tenure

51.5yo

Average Age

Experienced Management: RIO's management team is considered experienced (2.8 years average tenure).


Board Age and Tenure

2.5yrs

Average Tenure

60yo

Average Age

Experienced Board: RIO's board of directors are not considered experienced ( 2.5 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$12726 Apr 19
Jean-Sébastien Jacques
EntityIndividual
Role
Chief Executive Officer
CEO & Director
Shares2.76
Max PriceUS$45.96
BuyUS$22626 Apr 19
Alfredo Barrios
EntityIndividual
Role
Unit CEO
Chief Executive of Rio Tinto Aluminium
Shares4.92
Max PriceUS$45.96
SellUS$566,40404 Mar 19
Jean-Sébastien Jacques
EntityIndividual
Role
Chief Executive Officer
CEO & Director
Shares13,090
Max PriceUS$43.27
SellUS$35,74104 Mar 19
Bold Baatar
EntityIndividual
Role
Unit CEO
Chief Executive of Energy & Minerals
Shares826
Max PriceUS$43.27
SellUS$395,09804 Mar 19
Alfredo Barrios
EntityIndividual
Role
Unit CEO
Chief Executive of Rio Tinto Aluminium
Shares9,131
Max PriceUS$43.27

Ownership Breakdown


Management Team

  • Chris Salisbury (52yo)

    Chief Executive of Iron Ore Group

    • Tenure: 3.3yrs
    • Compensation: US$2.52m
  • Philip Richards (63yo)

    Group Executive & Group General Counsel

    • Tenure: 2.6yrs
    • Compensation: US$1.73m
  • Jakob Stausholm (51yo)

    CFO & Executive Director

    • Tenure: 1.1yrs
    • Compensation: US$1.97m
  • J-S Jacques (48yo)

    CEO & Director

    • Tenure: 3.3yrs
    • Compensation: US$6.14m
  • Arnaud Soirat (54yo)

    Chief Executive of Copper & Diamonds

    • Tenure: 3.3yrs
    • Compensation: US$2.64m
  • Bold Baatar (45yo)

    Chief Executive of Energy & Minerals

    • Tenure: 2.8yrs
    • Compensation: US$2.22m
  • Alf Barrios (53yo)

    Chief Executive of Rio Tinto Aluminium

    • Tenure: 5.8yrs
    • Compensation: US$3.24m
  • Stephen McIntosh (55yo)

    Group Executive of Growth & Innovation

    • Tenure: 0.8yrs
    • Compensation: US$2.60m
  • Simon Trott (44yo)

    Chief Commercial Officer

    • Tenure: 0yrs
    • Compensation: US$2.52m
  • Vera Kirikova (45yo)

    Human Resources Group Executive

    • Tenure: 2.8yrs
    • Compensation: US$1.64m

Board Members

  • Megan Clark (60yo)

    Independent Non-Executive Director

    • Tenure: 4.9yrs
    • Compensation: US$332.00k
  • Sam Laidlaw (63yo)

    Senior Independent Non-Executive Director

    • Tenure: 0.4yrs
    • Compensation: US$237.00k
  • Simon Thompson (60yo)

    Independent Chairman of the Board

    • Tenure: 1.6yrs
    • Compensation: US$852.00k
  • Simon Henry (58yo)

    Independent Non-Executive Director

    • Tenure: 2.5yrs
    • Compensation: US$224.00k
  • Michael L'Estrange (66yo)

    Independent Non-Executive Director

    • Tenure: 5.1yrs
    • Compensation: US$275.00k
  • Simon McKeon (63yo)

    Independent Non-Executive Director

    • Tenure: 0.8yrs
  • David Constable (58yo)

    Independent Non-Executive Director

    • Tenure: 2.7yrs
    • Compensation: US$323.00k
  • Jakob Stausholm (51yo)

    CFO & Executive Director

    • Tenure: 1.1yrs
    • Compensation: US$1.97m
  • J-S Jacques (48yo)

    CEO & Director

    • Tenure: 3.3yrs
    • Compensation: US$6.14m

Company Information

Rio Tinto Group's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Rio Tinto Group
  • Ticker: RIO
  • Exchange: LSE
  • Founded: 1873
  • Industry: Diversified Metals and Mining
  • Sector: Materials
  • Market Cap: UK£66.851b
  • Shares outstanding: 1.62b
  • Website: https://www.riotinto.com

Number of Employees


Location

  • Rio Tinto Group
  • 6 St James’s Square
  • London
  • Greater London
  • SW1Y 4AD
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RIOLBATS-CHIXE (BATS 'Chi-X Europe')YesPLC Ordinary SharesGBGBPJan 1975
RIOLSE (London Stock Exchange)YesPLC Ordinary SharesGBGBPJan 1975
RIO1DB (Deutsche Boerse AG)YesPLC Ordinary SharesDEEURJan 1975
RIO1XTRA (XETRA Trading Platform)YesPLC Ordinary SharesDEEURJan 1975
RTPP.FOTCPK (Pink Sheets LLC)YesPLC Ordinary SharesUSUSDJan 1975
RIOPSWX (SIX Swiss Exchange)YesPLC Ordinary SharesCHCHFJan 1975
RIO NBMV (Bolsa Mexicana de Valores)SPONSORED ADRMXMXNJun 1990
0KWZLSE (London Stock Exchange)SPONSORED ADRGBUSDJun 1990
RIONYSE (New York Stock Exchange)SPONSORED ADRUSUSDJun 1990
RIOADB (Deutsche Boerse AG)SPONSORED ADRDEEURJun 1990
RIOASX (Australian Securities Exchange)LTD Ordinary SharesAUAUDDec 1995
CRA1DB (Deutsche Boerse AG)LTD Ordinary SharesDEEURDec 1995
RTNT.FOTCPK (Pink Sheets LLC)LTD Ordinary SharesUSUSDDec 1995
RIOSWX (SIX Swiss Exchange)LTD Ordinary SharesCHCHFDec 1995
RIOCHIA (Chi-X Australia)LTD Ordinary SharesAUAUDDec 1995
RIO1EURTSX (The Toronto Stock Exchange)LTD Ordinary SharesCAEURDec 1995

Biography

Rio Tinto Group engages in finding, mining, and processing mineral resources worldwide. The company offers aluminium, silver, molybdenum, copper, diamonds, gold, borates, titanium dioxide, salt, iron ore,  ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/19 20:42
End of Day Share Price2019/10/18 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.