Rio Tinto 1st Half Review 2024
Performance: -11.23%
Dividend received: RIO paid a dividend of AUD 1.09619C per share
Full-year weighted portfolio Forecast: -6.12pc
Summary: It’s hard to hold a stock when you are down 11pc for the first half of the year. The next dividend is Sept 24 so will hold to receive and after that evaluate the portfolio. While RIO has some positive news coming out of the 1st half, I don’t see a large enough recovery in China, Iron and Copper and other projects to offset the loss this year. I will update members shortly on the replacement after next dividend as needed.
Company updates
RIO made a staggering $9.2 billion investment in Guinea’s Simandau high-grade iron ore deposit, which is a major investment to their strategic development. Rio Tinto’s dedication to increasing its production capacity and diversifying its portfolio is highlighted by the acceptance of this complex project by both the Guinean and Chinese governments.
The production of iron ore by Rio Tinto increased by 2% from the first quarter to 79.5 million tonnes in the second quarter of 2024. There was a 3% increase in iron ore exports as well during that time. Despite these improvements, production fell 2% from the previous year in the first half of 2024. Rio Tinto is confident in its ability to achieve its annual targets, as it has maintained its 2024 iron ore projection between 323 and 338 million tonnes.
Despite a 2.5% drop in share price owing to unfulfilled expectations, analysts agree that Rio Tinto still has strong long-term prospects. Important developments include the Simandau project’s approval, which will allow Rio Tinto to reap the benefits of expected increases in copper prices and offer strong protection against inflation.
Industry watchers have pointed out Rio Tinto’s resiliency, mentioning the company’s exposure to copper and iron ore. Rio Tinto is still a good bet regardless of the ups and downs of the market and the economy. Members looking for stability and development in the commodities industry should continue to hold due to its substantial dividend yield and potential for capital gains. Plus franking credits if you pay Aus. tax.
The big question is when commodity prices and revenues will turn around, as we know this is mainly China dependent, so we continue to watch this stock.