Rio Tinto Plc (RIO)

[qineqt]

We are bullish on the iron ore industry in the long term, and our top picks are VALE SA (VALE) and Rio Tinto PLC (RIO). RIO has recently touched its three-year low level, and its valuations are cheap based on forward price-to-earnings and EV/EBITDA multiples.

Moreover, its reasonable dividend yield, historical balance sheet strength and diversified asset base make us recommend a long position in the stock for long-term investors. Near-term investors should stay away from this overall sector, given the volatilities accompanying metal prices, and its reliance on a steel rebound.

Source URL: http://seekingalpha.com/article/846711-buy-rio-tinto-to-play-iron-ore-rebound