Berenberg lowers target price on Anglo American

(Sharecast News) - Analysts at Berenberg trimmed their target price on Anglo American from 5,200p to 5,100p on Friday, citing updated modelling after the miner's secondquarter production report and adjustments linked to Peruvian royalty changes at Quellaveco.

Berenberg said Q2 copper output of 173,000 tonnes beat its 164,000 tonne forecast on stronger volumes in both Chile and Peru, while iron ore production of 15.4m tonnes was slightly light versus its 15.7m tonnes estimate due to weaker output at Kumba. Steelmaking coal volumes came in at 2m tonnes, versus 2.4m expected, while diamonds delivered a solid beat at 7.8m carats against its 5.8m carat forecast, though market conditions remained challenging.

Anglo American maintained operational guidance but cut blended copper cost guidance to $1.45 per pund from $1.72, helped by higher byproduct credits. Realised prices were softer across bulks, while copper outperformed at $6.08 per pound versus Berenberg's $5.91 estimate.

Berenberg, which kept its 'hold' rating on the stock, said Teck Resources was "the star of the show", with the Canadian group's Q2 results beating consensus and showing further operational progress at the historically difficult Quebrada Blanca mine. It argued Teck's update was the main driver of Anglo's shareprice strength on 23 July, adding that Teck reiterated merger timing of September 2026 to March 2027, with encouraging commentary on Chinese approvals.

Ahead of Anglo's interim results on 30 July, the German bank forecasts revenues of $9.9bn, adjusted underlying earnings of $3.6bn, adjusted earnings per share of $0.60, and a dividend of $0.24 - all of which were slightly below consensus.

Reporting by Iain Gilbert at Sharecast.com