The Rio Tinto Limited (ASX: RIO) share price has been on a tear over 2019 to climb around 40% from $76.65 to $105.76, but it may have some gas left in the tank if the mining analysts at Goldman Sachs are on the money.
Goldmans' commodities team run the ruler over Rio Tinto and other mining businesses on May 27 and remain bullish on the outlook for iron ore prices.
In fact according to a May 27 note Goldmans is forecasting the iron ore price to average US$91, US$80, and US$72 a seaborne tonne over FY19-21 to respectively.
The upgrades to price estimates are the result of forecasts for stronger demand out of China combining with a supply shortage out of Brazil.
This is theoretically good news for the likes of Rio and others such as BHP Group Ltd (ASX: BHO) and Fortescue Metals Group Limited (ASX: FMG).
As a result of its improved forecasts Goldmans has put a $108.40 12-month share price target on Rio based on it trading at 6.5x EV/EBITDA.
