RBC Capital sees Glencore (LON:GLEN) as a ‘top pick,’ WebFG News reports. The analysts argue that the market reaction to the new Russian sanctions provided an ‘even better’ entry point for the shares.
Glencore’s share price has been steady in today’s session, having added 0.16 percent to 347.05p as of 10:40 BST. The stock is outperforming the broader London market, with the benchmark FTSE 100 index having slipped marginally into the red and currently standing 0.03 percent lower at 7,264.26 points.
RBC upbeat on Glencore
RBC sees Glencore as a ‘top pick’ with a price target of 460p on the shares, while admitting that the revised Russian sanctions might represent another headline risk, albeit one with a minor tangible impact. The analysts therefore continue to see the group’s ‘compelling valuation’ as providing a strong entry point for investors.
The London-listed miner came under pressure earlier this week following the latest round of US sanctions against Russia, announcing yesterday that its chief executive officer Ivan Glasenberg would step down as from his position as a director of Russian aluminium producer Rusal. The FTSE 100 group, however, reassured investors that its contracts with the company were not ‘financially material’.
‘Unlikely to be hit’
“As we understand it, a decision by OFAC to name other non-US entities under secondary sanctions would be a further escalation and would need to follow due process,” RBC’s analysts Tyler Broda and Barbora Baluskova commented, as quoted by WebFG News. “The potential for a Russian retaliation of some sort remains and although it will be difficult to judge any impact in advance with Glencore being a non-US entity we think is unlikely to be hit by the main focus of any sanctions.”