Berenberg Cuts Anglo American Target Price to 5,100p

Analysts at Berenberg have trimmed their target price for Anglo American from 5,200p to 5,100p after the miner's second-quarter production report.

The update included stronger copper output of 173,000 tonnes in both Chile and Peru, beating Berenberg's estimate of 164,000 tonnes. However, iron ore production was slightly lighter at 15.4m tonnes compared to their forecast of 15.7m tonnes due to weaker output at Kumba.

Steel-making coal volumes came in lower than expected at 2m tonnes, while diamonds delivered a solid beat with 7.8m carats against the estimate of 5.8m carats.

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

Berenberg kept its 'hold' rating on the stock and attributed Anglo American's share-price strength on 23 July to Teck Resources' impressive Q2 results, which showed further operational progress at the historically difficult Quebrada Blanca mine.