According to Brazilian bank Bradesco BBI, the Chinese reopening has improved ore prices, and Vale is well positioned to reap the rewards.
Bradesco BBI raised the target price for the mining company’s ADR to US$23, an upside of 28%. For the bank, a combination of factors will boost the company’s results: the reopening of the Chinese economy with policies to encourage growth; the drop in iron ore supply; and low inventories at Chinese mining companies.
According to Bradesco, the demand for steel in China is expected to increase between 4% and 5% this year compared to 2022. Analysts now expect Vale to generate EBITDA of US$ 26 billion this year, which is 27% higher than the market consensus.
(Source: Brazil Journal)