If you're interested in gaining exposure to the mining sector, then the two ASX 200 shares listed below could be worth considering.
Here's why analysts are positive on them right now:
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Iluka Resources Limited (ASX: ILU)
The first ASX 200 mining share to consider is this mineral sands company. Goldman believes it could be a top option for investors due to the favourable outlook for mineral sands and its exposure to rare earths.
The broker recently explained: "We are Buy rated on mineral sands/rare earth producer ILU and add the company to our Conviction List (CL) on attractive valuation and compelling Zircon and TiO2 price upside and Rare Earth growth potential."
"ILU is trading at a >50% discount to RE peers and >10% discount to min sands/pigment peers on an EV/EBITDA basis. Iluka recently released a larger-than-expected maiden resource on the Wimmera rare earth (RE) & zircon deposits in Victoria containing over c.1Mt of rare earth oxides (REO) and 10.6Mt of zircon. The Wimmera deposit is an important part of ILU's rare earth growth strategy," Goldman added.
Goldman Sachs has a conviction buy rating and $12.50 price target on Iluka's shares.
South32 Ltd (ASX: S32)
Another ASX mining share that could be in the buy zone is South32. The team at Morgans is positive on the diversified miner.
In response to its half year results, its analysts commented: "The diversified miner is enjoying robust prices across its basket of metals, allowing it to increase its dividend, upsize its buyback and strengthen its balance sheet."
"We see S32 as a key ex-iron ore / ex-WA mining exposure in Australia, offering investors diversified base metals exposure at an attractive multiple. [..] While 'late to the party', we expect S32's share price to continue to re-rate as it completes its accretive copper acquisition and continues to enjoy cycle high FCF. We maintain our Add rating with S32 a preferred exposure in the mining sector," it added.
The broker currently has an add rating and $4.90 price target on its shares.
