Rio Tinto(RIO) ZACKS·2025-02-26 18:15Core Viewpoint - Rio Tinto's fiscal 2024 results showed declines in revenues, EBITDA, and earnings per share, primarily due to lower iron ore prices, despite some offset from higher prices in other commodities [1][5][6]. Financial Performance - Total revenues for fiscal 2024 decreased by 1% to 29.3 billion [5][6]. - Underlying EBITDA fell by 2% to 6.70 [6][14]. - Iron ore production was 328 million tons (Mt), down 1% year-over-year, with shipments also declining by 1% to 328.6 Mt [5][6]. Commodity Performance - Aluminum production increased by 1% to 3.3 million tons, with revenues rising 11% year-over-year to 9.3 billion, supported by an 8% increase in copper prices and a 13% rise in production to 697 thousand tons [6][7]. Production Guidance - For 2025, Rio Tinto expects Pilbara iron ore shipments to range between 323-338 Mt, indicating a potential decline of 2% to growth of 3% [8]. - Bauxite production is projected between 57-59 Mt, while alumina production is anticipated to be between 7.4 Mt and 7.8 Mt [9]. - Copper production is expected to be in the range of 780-850 thousand tons for 2025 [10]. Earnings Estimates - The consensus estimate for Rio Tinto's 2025 revenues is 6.28 per share [13][14]. - Earnings have been on a downward trend since 2022, with 2024 figures falling below the five-year average [14]. Market Performance - Over the past year, Rio Tinto shares have declined by 4%, compared to a 5.9% drop in the industry and a 19.1% rise in the S&P 500 [16]. - Iron ore prices have decreased by 10% over the year due to weak demand in China, although recent market optimism has seen prices recover to 10 billion annually in capital expenditures, including $2.5 billion for expanding the Rincon lithium project in Argentina [23][22]. Valuation - Rio Tinto is currently trading at a forward price-to-earnings multiple of 9.90, which is lower than the industry average of 13.26 and below competitors like BHP Group and Freeport-McMoRan [25].