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Brokers say these are the ASX 200 mining shares to buy

a man with a hard hat and high visibility vest stands with a clipboard and pen in front of a large pile of rock at a mining site.

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If you’re wanting to diversify your portfolio by investing in the mining sector, then you may want to check out the ASX 200 mining shares listed below.

Both have recently been tipped as buys in the sector by leading brokers. Here’s what you need to know about these mining shares:

Iluka Resources Limited (ASX: ILU)

The first ASX 200 mining share for investors to look at is Iluka.

It is the mineral sands and rare earths miner behind a number of quality projects across South Australia and Western Australia. This includes the Eneabba project, where Iluka is developing a fully integrated rare earths refinery, which will be only the third of its kind outside the China market.

This is a big positive given how demand for rare earths is expected to remain strong long into the future.

Analysts at Goldman Sachs are bullish on Iluka. They commented:

We are positive on ILU’s project pipeline and forecast >40% production growth in mineral sands volumes, c.18ktpa of Rare Earths (~3.5-4ktpa of high value NdPr). We think ILU’s Eneabba RE refinery is a strategic asset considering it will be only the third western world RE refinery.

The Zircon and TiO2 feedstock markets entered a supply side driven deficit in 2021, and we think prices will remain supported in 2H22 & 2023.

Goldman Sachs currently has a conviction buy rating and $13.30 price target on Iluka’s shares.

Another ASX 200 mining share that has been tipped as a buy is South32.

It is a diversified mining mining and metals company producing alumina, aluminium, bauxite, coal, copper, lead, manganese, nickel, silver, and zinc at operations in Australia, Southern Africa and South America.

Morgans is very positive on the miner due to its portfolio optimisation and exposure to metals that will be important to the decarbonisation megatrend.

It explained:

S32 has transformed its portfolio by divesting South African thermal coal and acquiring an interest in Chile copper, substantially boosting group earnings quality, as well as S32’s risk and ESG profile. Unlike its peers amongst ASX-listed large-cap miners, S32 is not exposed to iron ore. Instead offering a highly diversified portfolio of base metals and metallurgical coal (with most of these metals enjoying solid price strength). We see attractive long-term value potential in S32 from de-risking of its growth portfolio, the potential for further portfolio changes, and an earnings-linked dividend policy.

Morgans has an add rating and $5.50 price target on South32’s shares.

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