Rio Tinto plc

United Kingdom Country flag United Kingdom
Sector: General Mining
Ticker: RIO
ISIN: GB0007188757
Factsheet Factsheet

Market multiple valuation of Rio Tinto plc ( RIO | GBR)

The most common multiple used in the valuation of stocks is the P/Earnings NTM multiple (Price to Earnings). P/E relates the current share price with the market expectations in terms of Earnings Per Share. This multiple is used to compare a company's market value with its earnings. A company with a high P/Earnings NTM is considered to be overvalued; a company with a low P/Earnings NTM is considered to be undervalued.
The P/Earnings NTM ratio of Rio Tinto plc is significantly lower than the median of its peer group: around 14.00. The company valuation of Rio Tinto plc according to these metrics is way below the market valuation of its peer group.
The P/Earnings NTM ratio of Rio Tinto plc is significantly higher than the average of its sector (General Mining): 4.09. The company valuation of Rio Tinto plc according to these metrics is way above the market valuation of its sector.
The P/Earnings NTM ratio of Rio Tinto plc is slightly higher than its historical 5-year average: 8.9. The (current) company valuation of Rio Tinto plc is therefore consistent with its valuation average over the last five years.

Valuation
P/E Last P/E (e) 2024P/E NTM
Rio Tinto plcFree trialFree trialFree trial
International PeersFree trialFree trialFree trial
General Mining-4.233.424.09
Cboe UK 10018.2113.7813.61
United Kingdom11.7111.2611.50
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Beta (Ref: Cboe UK 100)
Levered betaUnlevered beta
1-Year1.211.18
2-Year1.321.29
3-Year1.121.09
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Stock Perf excl. Dividends (in GBP)
RIOCboe UK 100Rel. Perf.
Year-to-Date-8.0%3.5%-11.5%
1-Week8.0%1.2%6.9%
1-Month9.4%3.0%6.4%
1-Year-2.6%2.2%-4.8%
3-Year-4.8%16.4%-21.2%
5-Year12.6%7.5%5.1%
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International Peers - Rio Tinto plc
Company NameCtryMarket
Cap.
last (mUSD)
Rio Tinto plcGBR109 276
International Peers Median1.26
Rio Tinto LimitedAUS135 391
Anglo American plcGBR33 718
BHP Group PlcGBRN/A
Vedanta LimitedIND16 119
Ferrexpo plcGBR351
GPRV Analysis
Rio Tinto plc
Intl. Peers
U.S Patents No. 7,882,001 & 8,082,201
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Net Sales Chart
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Quotes Chart

1-Year Rebased Stock Chart

  • Rio Tinto plc
  • Cboe UK 100
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Did you know ?

On the Infront Analytics platform, there are two ways to identify the listed peers which most closely resemble a private firm:
- with Peer Tracker if you already know a listed peer.
Peer Tracker is a patented technology tool for building peer groups using industry classifications. The degree of similarity between two companies is calculated comparing their sector footprints and measured using comparability scores.
- with Market Screener if you have no listed peer in mind.
Market Screener is a dedicated interface for screening companies using multiple criteria, identifying peers, searching for comparable companies in a specific business sector.

About Market Multiples

Many methods can be used to value a company. In reality, business valuation is often a combination of these different approaches. One of the most widely used quantitative methods is the market multiples method. The market valuation is utilized generally as a primary market input, to provide an objective starting point for the valuation. Put simply, this method multiplies the sales or profits of a business by an industry averaged multiplier to calculate the Market Value of the business.
Current multiples include:
- Historical multiples based on standardized financials for the last completed fiscal period: Last, Last Twelve Months (LTM);
- Forward multiples based on consensus estimates for the current fiscal period and next ones: Next Twelve Months (NTM), FY0, FY1.
Current multiples based on per-share metrics (such as earnings per share or book value per share) are calculated using the last closing price, while current multiples based on company-level metrics (such as net sales, EBIT or EBITDA) are calculated using the current market cap or EV (Enterprise Value).