Rio Tinto shares: Buy, hold or fold in February?

ASX 200 investors who bought Rio Tinto shares on 1 November have seen the miner's stock soar by more than 37%.

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Rio Tinto Ltd (ASX: RIO) shares are up 1.12% in lunchtime trade, going for $124.32 apiece.

That intraday lift sees shares in the S&P/ASX 200 Index (ASX: XJO) miner up 7% so far in 2023.

Atop the potential for share price gains, Rio Tinto also pays a fully franked trailing dividend yield of 7.7%.

Of course, there are no guarantees that Rio Tinto will deliver that same kind of passive income in the year ahead. Nor that its share price will keep marching higher.

So what's an ASX 200 investor to do?

A young investor working on his ASX shares portfolio on his laptop.

Image source: Getty Images

Buy, hold or fold?

In the fold camp, we have Argonaut analyst Harrison Massey (courtesy of The Bull).

Among his concerns, Massey cites the massive 39% leap in the Rio Tinto share price over the past three months of trading.

"The share price of this global miner has risen from $90.49 on November 1, 2022 to trade at $125.57 on February 2, 2023," he said.

The miner's performance is also highly dependent on the price of iron ore and copper. Both industrial metals have seen big price lifts since early November. But demand could slide should global recession fears come to fruition.

"Despite the company typically paying attractive dividends, it may be prudent for investors to consider taking a profit around these levels," Massey said. "Ongoing concerns about a global economic slowdown may impact iron ore spot prices in the medium term."

But not everyone believes Rio Tinto shares are ones to fold in February.

Included in that buy camp are the analysts at Goldman Sachs.

Following on from the ASX 200 miner's quarterly update in January, the broker retained its buy rating and increased its price target for Rio Tinto to $134.40 per share. That's some 8% above the current share price.

Among reasons to be bullish on the stock, Goldman's analysts cited the miner's record iron ore production and its guidance for a 15% increase in mined copper production for the full year.

How have Rio Tinto shares performed longer-term?

As you can see in the chart below, thanks to the strong performance since early November, Rio Tinto shares are up 8% over the past 12 months.

Investors who bought shares five years ago will be sitting on gains of 62%.

And those figures don't include dividends.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Resources Shares

Two workers on a tablet at a mine site, with mining machinery behind them.
Resources Shares

Aeris Resources: FY26 profit surges on revenue growth and cash boost

Aeris Resources posts a massive profit surge and revenue growth in FY26 as balance sheet and cash flow strengthen.

Read more »

Two miners laughing and having fun while using smart phone during their coffee break.
Resources Shares

Mineral Resources shares jump 5% today: Buy, sell or hold?

The lithium miner posted its strongest-ever financial result this morning.

Read more »

Gold coins.
Resources Shares

Brightstar Resources posts record gold drilling intercepts at Sandstone

Brightstar Resources revealed exceptionally wide, high-grade gold intercepts at its Sandstone Gold Project.

Read more »

Two miners examine things they have taken out the ground.
Resources Shares

Tivan launches drone magnetic survey at Timor-Leste copper-gold projects

Tivan launches a high-tech drone magnetic survey over its Timor-Leste projects, setting the stage for new copper and gold drilling…

Read more »

Gold bars on top of coins.
Resources Shares

Aurelia Metals: FY26 profit surges, dividend announced

Aurelia Metals reported a strong FY26 result with surging profit, increased revenue, and a fully franked final dividend for shareholders.

Read more »

Mining vehicle at a mine site.
Resources Shares

29Metals: HY26 earnings show revenue up, mine progress on track

29Metals posted higher HY26 revenue and cash flow, while restarting key mines remains central to its growth strategy.

Read more »

Man holding a calculator with Australian dollar notes, symbolising dividends.
Resources Shares

Is the Rio Tinto share price a buy for its 5% dividend yield?

Should investors dig into Rio Tinto for the dividend?

Read more »

Young successful engineer, with blueprints, notepad, and digital tablet, observing the project implementation on construction site and in mine.
Earnings Results

AIC Mines net profit soars 177% as plant expansion powers growth

AIC Mines net profit jumped 177% in FY26 as copper production hit guidance and plant expansion progressed.

Read more »