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Revisions to our forecasts, TPs and ratings
Our commodity price and currency revisions, as detailed on page 32, resulted in earnings revisions, as detailed on page 55-57.
Changes to our TPs are summarised in Figure 1. We upgrade our rating on ARM from Hold to BUY as its medium-term cash generation benefits from an improved iron ore outlook.
Renaissance Capital
1 April 2019
Metals & Mining
We upgrade ARM to BUY
Companies ranked by total potential one-year return
Figure 1 shows the companies under our coverage ranked by potential 12-month returns, based on our TPs.
Figure 1: Summary sector ratings and TPs (ranked by total potential 12M return, including estimated dividends)
Company |
Unit |
12M TP |
Previous |
Current |
12M target |
12M fwd |
Total 12M |
12M forward |
Rating |
|
12M TP |
price* |
capital return |
dividend yield |
return |
rolling P/E |
|||||
|
|
|
|
|||||||
Rusal |
HKD |
6.6 |
6.0 |
3.5 |
86.4% |
4.0% |
90.4% |
3.8x |
BUY |
|
Norilsk |
$ |
31.0 |
27.0 |
22.4 |
38.3% |
12.1% |
50.4% |
7.0x |
BUY |
|
Alrosa |
RUB |
109.0 |
109.0 |
94.3 |
15.6% |
14.2% |
29.9% |
7.4x |
BUY |
|
Impala Platinum |
ZAR |
83.0 |
79.0 |
64.8 |
28.1% |
0.0% |
28.1% |
4.4x |
BUY |
|
Polyus |
RUB |
6,600.0 |
6,500.0 |
5,434.0 |
21.5% |
6.3% |
27.8% |
6.7x |
BUY |
|
Exxaro |
ZAR |
190.0 |
170.0 |
164.2 |
15.7% |
10.7% |
26.5% |
5.9x |
BUY |
|
Rio Tinto |
GBP |
50.0 |
48.0 |
43.1 |
15.9% |
8.3% |
24.2% |
8.5x |
BUY |
|
ARM |
ZAR |
190.0 |
170.0 |
166.0 |
14.5% |
8.6% |
23.1% |
4.6x |
BUY** |
|
Fortescue |
AUD |
7.1 |
6.0 |
6.6 |
7.3% |
15.5% |
22.7% |
5.3x |
BUY |
|
Merafe |
ZAR |
1.5 |
1.4 |
1.4 |
5.6% |
15.7% |
21.3% |
5.8x |
BUY |
|
Vale |
$ |
15.5 |
13.6 |
13.0 |
19.0% |
0.0% |
19.0% |
5.6x |
HOLD |
|
Sasol |
ZAR |
510.0 |
480.0 |
444.5 |
14.7% |
3.6% |
18.3% |
10.1x |
BUY |
|
Glencore |
ZAR |
65.0 |
55.0 |
59.4 |
9.4% |
6.8% |
16.2% |
9.9x |
HOLD |
|
Sibanye - Stillwater |
ZAR |
19.5 |
17.6 |
17.4 |
12.2% |
2.0% |
14.2% |
6.5x |
BUY |
|
Anglo American |
ZAR |
400.0 |
350.0 |
378.1 |
5.8% |
6.2% |
11.9% |
8.7x |
HOLD |
|
South32 |
ZAR |
40.0 |
37.0 |
38.1 |
5.1% |
6.4% |
11.6% |
11.6x |
HOLD |
|
Lonmin |
ZAR |
17.0 |
13.0 |
15.5 |
9.9% |
0.0% |
9.9% |
1.6x |
HOLD |
|
BHP |
ZAR |
340.0 |
315.0 |
339.9 |
0.0% |
9.0% |
9.1% |
10.7x |
HOLD |
|
Assore |
ZAR |
350.0 |
320.0 |
361.2 |
-3.1% |
10.1% |
7.0% |
5.4x |
HOLD |
|
RBPlats |
ZAR |
37.0 |
31.0 |
35.0 |
5.8% |
0.0% |
5.8% |
6.3x |
HOLD |
|
Polymetal |
GBP |
8.4 |
8.6 |
8.7 |
-3.0% |
6.0% |
3.0% |
8.4x |
HOLD |
|
Anglo American Platinum |
ZAR |
780.0 |
710.0 |
795.0 |
-1.9% |
3.9% |
2.0% |
10.4x |
HOLD |
|
Kumba Iron Ore |
ZAR |
330.0 |
280.0 |
405.4 |
-18.6% |
13.4% |
-5.2% |
7.5x |
SELL |
|
Northam |
ZAR |
60.0 |
52.0 |
67.3 |
-10.8% |
0.0% |
-10.8% |
9.3x |
SELL |
|
Gold Fields |
ZAR |
46.0 |
42.0 |
57.7 |
-20.3% |
2.5% |
-17.8% |
13.1x |
SELL |
|
Harmony |
ZAR |
22.0 |
19.0 |
29.6 |
-25.6% |
0.0% |
-25.6% |
6.5x |
SELL |
|
AngloGold |
ZAR |
115.0 |
110.0 |
205.3 |
-44.0% |
1.0% |
-43.0% |
11.5x |
SELL |
Note: Priced at market close on 26 March 2019. **Previously Hold
Source: Thomson Reuters Datastream, Renaissance Capital estimates
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