Erste Group downgraded Rio Tinto from Buy to Hold on Wednesday, citing a sustained decline in global iron ore prices that is expected to weigh on the miner’s revenue growth in 2026.
The move follows mixed analyst actions on Rio Tinto, which has reported strong operational performance in the first half of 2026 despite softer commodity markets. Erste Group’s decision reflects concerns over decelerating revenue momentum as iron ore prices retreat from recent peaks.
Goldman Sachs upgraded Rio Tinto to Buy from Neutral, setting a price target of GBP 82.00. Berenberg also upgraded the stock to Buy from Hold, assigning a target of US$ 113.00. Both upgrades cited Rio Tinto’s improving cash generation and robust free cash flow metrics.
Rio Tinto reported underlying EBITDA of US$ 14.8 billion in the first half of 2026, a 28% increase year-over-year, driven by higher copper and aluminum prices. Free cash flow surged 75%, while the interim dividend rose 43% to US$ 3.4 billion. The company has maintained dividend payments for 35 consecutive years and delivered a 77% total return over the past 12 months.
Rio Tinto currently trades at a P/E ratio of 14.1. Berenberg projected a free cash flow yield of 7% for the period from 2026 to 2028, underscoring the miner’s strong cash generation capacity amid volatile commodity markets.
