LSE:RIO

Stock Analysis Report

Executive Summary

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


Snowflake Analysis

6 star dividend payer with excellent balance sheet.


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

Stable Share Price: RIO's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

18.5%

RIO

15.3%

GB Metals and Mining

10.0%

GB Market


1 Year Return

-19.5%

RIO

-28.1%

GB Metals and Mining

-23.0%

GB Market

Return vs Industry: RIO exceeded the UK Metals and Mining industry which returned -27.1% over the past year.

Return vs Market: RIO exceeded the UK Market which returned -22.7% over the past year.


Shareholder returns

RIOIndustryMarket
7 Day18.5%15.3%10.0%
30 Day1.8%-13.9%-17.6%
90 Day-18.4%-26.0%-27.3%
1 Year-12.1%-19.5%-22.3%-28.1%-18.9%-23.0%
3 Year47.2%15.3%7.1%-11.0%-12.9%-24.2%
5 Year90.2%33.6%42.4%8.1%1.6%-21.8%

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?

32.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: RIO (£36.74) is trading below our estimate of fair value (£54.35)

Significantly Below Fair Value: RIO is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: RIO is poor value based on its PE Ratio (9.3x) compared to the Metals and Mining industry average (6.6x).

PE vs Market: RIO is good value based on its PE Ratio (9.3x) compared to the UK market (12.5x).


Price to Earnings Growth Ratio

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 (1.8x) compared to the GB Metals and Mining industry average (0.8x).


Next Steps

Future Growth

How is Rio Tinto Group forecast to perform in the next 1 to 3 years based on estimates from 18 analysts?

-3.1%

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 (-3.1% per year).

Earnings vs Market: RIO's earnings are forecast to decline over the next 3 years (-3.1% 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 (-4.4% per year).

High Growth Revenue: RIO's revenue is forecast to decline over the next 3 years (-4.4% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: RIO's Return on Equity is forecast to be low in 3 years time (15.9%).


Next Steps

Past Performance

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

35.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RIO has high quality earnings.

Growing Profit Margin: RIO's current net profit margins (18.6%) are lower than last year (33.7%).


Past Earnings Growth Analysis

Earnings Trend: RIO's earnings have grown significantly by 35.3% per year over the past 5 years.

Accelerating Growth: RIO's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: RIO had negative earnings growth (-41.3%) over the past year, making it difficult to compare to the Metals and Mining industry average (7.2%).


Return on Equity

High ROE: RIO's Return on Equity (15.4%) is considered low.


Next Steps

Financial Health

How is Rio Tinto Group's financial position?


Financial Position Analysis

Short Term Liabilities: RIO's short term assets ($17.3B) exceed its short term liabilities ($11.1B).

Long Term Liabilities: RIO's short term assets ($17.3B) do not cover its long term liabilities ($31.4B).


Debt to Equity History and Analysis

Debt Level: RIO's debt to equity ratio (28.3%) is considered satisfactory.

Reducing Debt: RIO's debt to equity ratio has reduced from 46% to 28.3% over the past 5 years.

Debt Coverage: RIO's debt is well covered by operating cash flow (116.4%).

Interest Coverage: RIO's interest payments on its debt are well covered by EBIT (24.6x 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 1.4x debt).


Next Steps

Dividend

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

8.83%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: RIO's dividend (8.83%) is higher than the bottom 25% of dividend payers in the UK market (2.7%).

High Dividend: RIO's dividend (8.83%) is in the top 25% of dividend payers in the UK market (7.3%)


Stability and Growth of Payments

Stable Dividend: RIO's dividends per share have been stable in the past 10 years.

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


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (81.1%), RIO's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: RIO's dividends in 3 years are forecast to be covered by earnings (64.1% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.3yrs

Average management tenure


CEO

J-S Jacques (48yo)

3.67s

Tenure

US$7,089,000

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 ($USD7.09M) is about average for companies of similar size in the UK market ($USD5.57M).

Compensation vs Earnings: J-S's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Jean-Sébastien Jacques
CEO & Executive Director3.67yrsUS$7.09m0.0076% $4.7m
Jakob Stausholm
CFO & Executive Director1.5yrsUS$2.52m0.0019% $1.2m
Vera Kirikova
Human Resources Group Executive3.17yrsUS$1.98m0.00024% $148.5k
Alfredo Barrios
Chief Executive of Aluminium5.75yrsUS$3.69m0.0039% $2.4m
Chris Salisbury
Chief Executive of Iron Ore Group3.67yrsUS$2.90m0.0021% $1.3m
Stephen McIntosh
Group Executive of Growth & Innovation1.17yrsUS$2.89m0.0012% $742.4k
Arnaud Soirat
Chief Executive of Copper & Diamonds3.67yrsUS$2.90m0.0018% $1.1m
Bold Baatar
Chief Executive of Energy & Minerals3.25yrsUS$2.71m0.0025% $1.5m
Simon Trott
Chief Commercial Officer2.17yrsUS$2.28m0.00076% $470.2k
Menno Gerard Sanderse
Head of Investor Relationsno datano datano data

3.3yrs

Average Tenure

51yo

Average Age

Experienced Management: RIO's management team is considered experienced (3.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Jean-Sébastien Jacques
CEO & Executive Director3.67yrsUS$7.09m0.0076% $4.7m
Jakob Stausholm
CFO & Executive Director1.5yrsUS$2.52m0.0019% $1.2m
Megan Clark
Independent Non-Executive Director5.33yrsUS$284.00kno data
William Samuel Laidlaw
Senior Independent Non-Executive Director0.83yrUS$273.00k0.00046% $284.6k
Simon Thompson
Independent Non-Executive Chairman of the Board2yrsUS$934.00k0.00046% $284.6k
Simon Henry
Independent Non-Executive Director2.92yrsUS$245.00k0.000090% $55.7k
Michael L'Estrange
Independent Non-Executive Director5.5yrsUS$201.00kno data
Simon McKeon
Independent Non-Executive Director1.17yrsUS$264.00kno data
David Constable
Independent Non-Executive Director3yrsUS$275.00k0.00016% $99.0k
Hinda Gharbi
Independent Non-Executive Directorno datano datano data

2.9yrs

Average Tenure

59yo

Average Age

Experienced Board: RIO's board of directors are not considered experienced ( 2.9 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: RIO insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

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£61.865b
  • 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
RTPP.FOTCPK (Pink Sheets LLC)YesPLC Ordinary SharesUSUSDJan 1975
RIOLSE (London Stock Exchange)YesPLC Ordinary SharesGBGBPJan 1975
RIO1DB (Deutsche Boerse AG)YesPLC Ordinary SharesDEEURJan 1975
RIOPSWX (SIX Swiss Exchange)YesPLC Ordinary SharesCHCHFJan 1975
RIO1XTRA (XETRA Trading Platform)YesPLC Ordinary SharesDEEURJan 1975
RIOLBATS-CHIXE (BATS 'Chi-X Europe')YesPLC Ordinary SharesGBGBPJan 1975
RIONYSE (New York Stock Exchange)ADR EACH REP 1 ORDUSUSDJun 1990
0KWZLSE (London Stock Exchange)ADR EACH REP 1 ORDGBUSDJun 1990
RIO NBMV (Bolsa Mexicana de Valores)ADR EACH REP 1 ORDMXMXNJun 1990
RIOADB (Deutsche Boerse AG)ADR EACH REP 1 ORDDEEURJun 1990
RTNT.FOTCPK (Pink Sheets LLC)LTD Ordinary SharesUSUSDDec 1995
CRA1DB (Deutsche Boerse AG)LTD Ordinary SharesDEEURDec 1995
RIOASX (Australian Securities Exchange)LTD Ordinary SharesAUAUDDec 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
RTPBASE (Buenos Aires Stock Exchange)CEDEAR EACH REPR 4 SPON ADRARARSJul 2007

Biography

Rio Tinto Group engages in finding, mining, and processing mineral resources worldwide. The company offers aluminum, silver, molybdenum, copper, diamonds, gold, borates, titanium dioxide, salt, iron ore, and uranium. It is also involved in the alumina production; primary aluminum smelting; bauxite mining; alumina refining; and ilmenite, rutile, and zircon mining, as well as provision of gypsum. Rio Tinto Group was founded in 1873 and is headquartered in London, the United Kingdom. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/30 21:00
End of Day Share Price2020/03/30 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


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.