Rio Tinto share price races higher after Q3 update beats expectations

Rio Tinto has released its quarterly update. How did it perform?

| 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

The Rio Tinto Ltd (ASX: RIO) share price is on the move on Tuesday morning.

At the time of writing, the mining giant's shares are up 3% to $119.44.

This follows the release of the miner's third-quarter operational update.

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

Image source: Getty Images

Rio Tinto share price higher on Q3 update

For the three months ended 30 September, Rio Tinto reported the following compared to the second quarter:

  • Pilbara iron ore shipments up 6% to 83.9Mt
  • Bauxite production up 3% to 13.9Mt
  • Aluminium production up 2% to 828kt
  • Mined copper production up 17% to 169kt
  • Titanium dioxide slag production down 19% to 247kt
  • IOC iron ore pellets and concentrate up 16% to 2.4Mt

What happened during the quarter?

Rio Tinto had a solid quarter and has delivered production and shipments either in line or ahead of expectations for the majority of commodities. As a result, its guidance for the full-year remains unchanged for all but one commodity – IOC iron ore pellets.

Rio Tinto's Chief Executive, Jakob Stausholm, was pleased with the quarter. He said:

We delivered another quarter of progress and maintained momentum at our Pilbara iron ore operations. We continued to make good headway ramping up our Oyu Tolgoi high-grade underground copper mine, our Kitimat aluminium smelter returned to full production, and we safely restarted the smelter and refinery at Kennecott after completing the largest rebuild in its history. We have more to do as we work towards sustainable performance improvements across our business.

Stausholm also highlights that the company has been making progress in gaining exposure to future facing materials. He adds:

We took real steps to build our portfolio of materials needed for the future, signing agreements that will see us take a leading position in recycled aluminium in North America and agreeing to enter a joint venture with Codelco to explore for copper in Chile. We also completed further infrastructure agreements with our partners for the world class Simandou iron ore project.

How does this compare to expectations?

According to a note out of Goldman Sachs, its analysts were expecting iron ore shipments of 83.9Mt versus the consensus estimate of 83.5Mt. It had also pencilled in aluminium production of 821kt (cons. 814kt) and mined copper of 164kt (cons. 152kt).

As you can see above, this means the company has delivered or beaten these estimates with its update today.

This may explain why the Rio Tinto share price is having such a good session.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. 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 Materials Shares

Business people standing at a mine site smiling.
Materials Shares

This ASX materials stock could rise 20% according to this broker

Fresh tailwinds could push this mining equipment company higher.

Read more »

A woman presenting company news to investors looks back at the camera and smiles.
Materials Shares

What's this broker's updated view on this ASX materials stock following a 25% fall?

This ASX materials stock was heavily sold off last week.

Read more »

A smiling woman holds a Facebook like sign above her head.
Materials Shares

Why this ASX mining stock could be a strong buy after major milestone

Bell Potter is recommending this stock to clients.

Read more »

A hand holding a lump of rare earths material against a blue sky.
Materials Shares

This ASX critical minerals company could more than double in value: Broker

An important US government milestone was achieved this week.

Read more »

A group of people gathered around a laptop computer with various expressions of interest, concern and surprise on their faces as they review the payouts from ASX dividend stocks. All are wearing glasses.
Resources Shares

Buy, hold, or sell? South32, Capstone Copper, and BHP shares

Let's see what the experts think.

Read more »

A man wearing a suit holds his arms aloft, attached to a large lithium battery with green charging symbols on it.
Materials Shares

PLS shares jump 320% in 12 months: Buy, sell or hold?

The lithium miner has flown from strength to strength over the past year.

Read more »

Business people standing at a mine site smiling.
Materials Shares

Morgans just placed buy ratings on these ASX materials stocks

These two stocks could be worth adding to your portfolio according to Morgans.

Read more »

Female miner in hard hat and safety vest on laptop with mining drill in background.
Materials Shares

Why Lynas could be one of the ASX's biggest winners again today

Lynas is gaining strategic value as rare earths tensions rise.

Read more »