Are you in the market for some ASX mining shares this month? If you are, then it could be worth hearing what analysts are saying about the two listed below.
Here's why these ASX 200 mining shares are rated as buys:
IGO Ltd (ASX: IGO)
Goldman Sachs is a fan of this battery materials-focused ASX 200 mining share. It likes IGO due to its attractive valuation and the low costs of its Greenbushes lithium operation. Its analysts explain:
IGO is a mining and exploration company focused on metals enabling the clean energy transition. It has an indirect 49% ownership of Australia's first lithium hydroxide plant at Kwinana and ~25% of the world-class Greenbushes lithium spodumene mine, the largest and lowest cost hard rock lithium mine globally. IGO also owns and operates the Nova nickel-copper-cobalt mine (100% share), Forrestania nickel (100%), and Cosmos nickel project (100%). We see IGO's future facing commodity portfolio as defensive, and into a declining lithium price environment we expect low-cost assets with scale benefits will likely outperform on margin.
The broker has a buy rating and a $14.80 price target on its shares. This implies a potential upside of 17% from current levels. It is also forecasting a 3.9% dividend yield in FY 2024.
South32 Ltd (ASX: S32)
Over at Morgans, its analysts believe that South32 is an ASX 200 mining share to buy this month. South32 is a diversified mining company with a focus on commodities that are integral to the decarbonisation of the planet.
Morgans likes the company due partly to its portfolio transformation. It explains:
S32 has transformed its portfolio by divesting South African thermal coal and acquiring an interest in Chile copper, substantially boosting group earnings quality, as well as S32's risk and ESG profile. Unlike its peers amongst ASX-listed large-cap miners, S32 is not exposed to iron ore. Instead offering a highly diversified portfolio of base metals and metallurgical coal (with most of these metals enjoying solid price strength). We see attractive long-term value potential in S32 from de-risking of its growth portfolio, the potential for further portfolio changes, and an earnings-linked dividend policy.
The broker has an add rating and a $5.20 price target on South32's shares, which suggests a massive upside potential of 56%. It is also forecasting a 5% dividend yield in FY 2024.
