The Rio Tinto Limited (ASX: RIO) share price has been marching upwards in recent times.
At the time of writing, shares in the world's second largest miner are up 2.22% to $116.20.
This means that Rio Tinto shares have now gained 8.69% over the past week.
What's driving Rio Tinto shares higher?
There are a few factors as to why the Rio Tinto share price is trading in positive territory since last Thursday.
Firstly, the accent of iron ore prices is providing a strong support base for the company's margins thus far in FY22. Regarded as a key commodity in Rio Tinto's portfolio, this is particularly important given a majority of its revenues come from the steelmaking ingredient.
In the financial year ending 31 December 2021, iron ore accounted for 62% of the total group sales revenue.
In addition, the S&P/ASX 200 Resources Index (ASX: XJR) has also pushed ahead, gaining almost 8% since last week. The sector represents 48 of the largest companies in the S&P/ASX 200 Index (ASX: XJO) that are members in the energy, metals and mining industry.
A positive shift in investor sentiment toward the index has propelled Rio Tinto shares forward.
Lastly, analysts at Macquarie updated their outlook on Rio Tinto shares last Monday. The broker raised the 12-month price target by 8% to $140 apiece.
It appears that the broker believes that Rio Tinto shares are currently undervalued, with the latest assessment representing around a 20% upside.
Rio Tinto share price summary
Adding to today's gain, the Rio Tinto share price has surged 16% in 2022.
However, when looking across the past year, the mining outfit's shares are up 6%.
After reaching an all-time high of $137.33 in August 2021, investors heavily sold off the company's shares.
Rio Tinto hit a 52-week low of $87.28 in November before quickly rebounding higher.
The company has a price-to-earnings (P/E) ratio of 14.82 and commands a market capitalisation of roughly $41.14 billion.
