There's a big jump between this $6 S&P/ASX 200 Index (ASX: XJO) mining share and industry giant Fortescue Metals Group Limited (ASX: FMG) – a $58 billion one in fact.
But one fundie has reportedly tipped Champion Iron Ltd (ASX: CIA) to trade at valuations like those of mining goliaths Rio Tinto Limited (ASX: RIO) and Fortescue.
Right now, stock in the far smaller, $3.2 billion iron ore miner is trading for $6.17. And that could be just the tip of the iceberg.
Regal Funds portfolio manager and head of mining investments Tim Elliot believes it could double.
Let's take a look at what the fundie likes about the comparatively tiny ASX 200 iron ore mining share.
Image source: Getty Images
Could this ASX 200 mining share be gearing up to double?
This year's Sohn Hearts & Minds Investment Leaders Conference has officially kicked off, folks. And that means plenty of investment advice from some of the industry's top investment gurus.
Joining the voices today is Elliot and his apparent favourite ASX 200 mining share, Champion Iron.
Champion Iron operates in Canada. It works to produce high-grade iron ore capable of creating green steel.
The fundie told the conference, via the Australian Financial Review, "it's rare to find a multibillion-dollar miner and such tremendous value upside", noting it trades at 3.9 times EBITDA based on 12-month forward consensus earnings. Elliot continues:
It can double and that's without assuming it rises 43% to trading in line with Fortescue and Rio which it absolutely should.
[Champion Iron is] the most under-appreciated and exciting play on decarbonisation that's completely under the radar.
He is also said to have commended the company's "visionary" management and flagged a positive outlook for iron ore and steel.
Elliot isn't alone in expecting big things from the ASX 200 miner.
Goldman Sachs believes Champion Iron shares are a buy, slapping the stock with a $6.90 price target late last month. While not quite double, that does represent a potential 11% upside.
