Broker snap: Credit Suisse upgrades forecasts for Rio Tinto

4th Dec 2012 09:50

Credit Suisse has reiterated its 'outperform' rating for mining giant Rio Tinto, saying that the group's cost determination is impressive.The broker has upgraded its earnings forecasts for this year and the next by 5% and 13%, respectively, on the back of cost savings, higher copper volumes and mineral sands earnings.As such, the target price for the shares has been raised from 3,500p to 3,700p, providing around 20% potential upside to the current price, Credit Suisse said.The broker has also added Rio to its 'Europe Focus' list "as we see it as best positioned to capitalise on China growth momentum into 1H 2013."Credit Suisse highlights three main catalysts for the shares: a stabilisation/reacceleration of Chinese demand for steel/iron ore into 2013; start-up of the Oyu Tolgoi copper/gold miner in Mongolia; and the finalisation of asset sales (Pacific Aluminium/Diamonds/Palabora).By 09:50 on Tuesday, shares were up 0.83% at 3,146p.BC