Zacks Investment Research Upgrades Vale (NYSE:VALE) to Strong-Buy

Vale (NYSE:VALE) was upgraded by Zacks Investment Research from a “hold” rating to a “strong-buy” rating in a report issued on Tuesday, reports. The firm presently has a $13.00 target price on the basic materials company’s stock. Zacks Investment Research‘s price objective indicates a potential upside of 12.17% from the company’s previous close.

According to Zacks, “Vale expects iron ore fines production in 2020 to come in at the lower end of range of 310 Mt to 330 Mt. The coronavirus pandemic led to a 3.5 Mt loss of iron ore production in the second quarter and is expected to have a 6.3 Mt impact in the second half. The company continues to strive to sustain margins by focusing on product line, improving productivity and cutting costs. Vale is poised well to gain from high iron ore prices this year. The consensus estimate for the company’s ongoing quarter and current fiscal year earnings have thus undergone positive estimate revisions lately. Also, continued investment in growth projects, efforts to lower debt levels, ramp up its coal business and transforming base metals business will also aid growth for the company. Vale remains focused on introducing more high-quality ore in the market.”

Several other analysts have also recently weighed in on the company. Deutsche Bank lifted their price target on Vale from $11.00 to $13.00 and gave the stock a “buy” rating in a report on Thursday, June 11th. BNP Paribas upgraded Vale from a “neutral” rating to an “outperform” rating in a research note on Friday, June 5th. Royal Bank of Canada lowered their price objective on Vale from $16.30 to $16.00 and set an “outperform” rating on the stock in a research note on Tuesday, July 28th. UBS Group upgraded Vale from a “neutral” rating to a “buy” rating and lowered their price objective for the stock from $13.00 to $12.00 in a research note on Wednesday, June 3rd. Finally, Exane BNP Paribas upgraded Vale from a “neutral” rating to an “outperform” rating in a research note on Friday, June 5th. One analyst has rated the stock with a sell rating, one has assigned a hold rating, fifteen have assigned a buy rating and one has assigned a strong buy rating to the company. The stock currently has an average rating of “Buy” and a consensus price target of $13.71.

NYSE:VALE opened at $11.59 on Tuesday. The stock has a market cap of $59.44 billion, a P/E ratio of 44.58 and a beta of 1.01. The stock has a 50 day simple moving average of $11.39 and a 200 day simple moving average of $9.85. The company has a current ratio of 1.82, a quick ratio of 1.46 and a debt-to-equity ratio of 0.53. Vale has a 1-year low of $6.49 and a 1-year high of $13.67.

Vale (NYSE:VALE) last released its quarterly earnings results on Thursday, July 30th. The basic materials company reported $0.22 earnings per share for the quarter, missing the Thomson Reuters’ consensus estimate of $0.33 by ($0.11). The firm had revenue of $7.52 billion for the quarter, compared to analyst estimates of $7.13 billion. Vale had a return on equity of 17.48% and a net margin of 3.82%. As a group, sell-side analysts forecast that Vale will post 1.62 EPS for the current year.

Hedge funds have recently modified their holdings of the stock. American Beacon Advisors Inc. bought a new stake in Vale during the 2nd quarter worth $36,000. Atlas Capital Advisors LLC grew its position in Vale by 110.7% during the 2nd quarter. Atlas Capital Advisors LLC now owns 4,359 shares of the basic materials company’s stock worth $45,000 after acquiring an additional 2,290 shares during the last quarter. Rosenberg Matthew Hamilton bought a new stake in Vale during the 2nd quarter worth $80,000. IPG Investment Advisors LLC bought a new stake in Vale during the 1st quarter worth $89,000. Finally, Matthews International Capital Management LLC bought a new stake in Vale during the 2nd quarter worth $115,000. Institutional investors and hedge funds own 18.40% of the company’s stock.

About Vale

Vale SA, together with its subsidiaries, produces and sells iron ore and iron ore pellets for use as raw materials in steelmaking in Brazil and internationally. It operates through Ferrous Minerals, Coal, and Base Metals segments. The Ferrous Minerals segment produces and extracts iron ore and pellets, manganese, ferroalloys, and others ferrous products and services; and provides related logistic services.

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