What Is Ailing Rio Tinto Stock?

by Trefis Team
-1.95%
Downside
75.73
Market
74.25
Trefis
RIO
Rio Tinto
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Rio Tinto stock (NYSE: RIO) is down more than 5% in just the last one week, underperforming the S&P 500 which was up 1%. If you look at the change over the last ten days and one month, the stock has dropped on both the occasions (down -9.7% and -5.1%, respectively). The recent decline in RIO stock was driven by fall in iron ore prices and lackluster production numbers reported by the company. Global iron ore price per ton has fallen from $123 to $103, registering a decline of 16% in a week. Additionally, the company said that Q3 2021 has been another difficult quarter operationally. Production numbers for Pilbara iron ore, aluminum, mined copper, and bauxite fell by 3%-4% compared to Q3 2020. Titanium dioxide slag saw a y-o-y decrease of 29%. RIO also reduced its full-year guidance for pellets and concentrate to 9.5-10.5 million tons, from 10.5-12 million tons previously.

Now, is RIO stock set to drop further or could we expect some recovery? We believe that there is a 51% chance of a rise in RIO stock over the next month (21 trading days) based on our machine learning analysis of trends in the stock price over the last ten years. See our analysis on Rio Stock Chance of Rise. For additional details about RIO’s business, see our analysis on Rio Tinto Revenues.

Twenty-One Day: RIO -5.1%, vs. S&P500 5.9%; Underperformed market

(26% likelihood event; 51% probability of rise over next 21 days)

  • RIO stock decreased 5.1% the last twenty-one trading days (one month), compared to a broader market (S&P500) rise of 5.9%
  • A change of -5.1% or more over twenty-one trading days is a 26% likelihood event, which has occurred 642 times out of 2516 in the last 10 years
  • Of these 642 instances, the stock has seen a positive movement over the next twenty-one trading days on 328 occasions
  • This points to a 51% probability for the stock rising over the next twenty-one trading days

Ten Day: RIO -9.7%, vs. S&P500 2.9%; Underperformed market

(5% likelihood event; 50% probability of rise over next 10 days)

  • RIO stock decreased 9.7% over the last ten trading days (two weeks), compared to broader market (S&P500) rise of 2.9%
  • A change of -9.7% or more over ten trading days is a 5% likelihood event, which has occurred 125 times out of 2516 in the last 10 years
  • Of these 125 instances, the stock has seen a positive movement over the next ten trading days on 63 occasions
  • This points to a 50% probability for the stock rising over the next ten trading days

Five Day: RIO -5.1%, vs. S&P500 1%; Underperformed market

(12% likelihood event; 56% probability of rise over next five days)

  • RIO stock decreased 5.1% over a five-day trading period ending 11/01/2021, compared to the broader market (S&P500) marginal rise of 1%
  • A change of -5.1% or more over five trading days (one week) is a 12% likelihood event, which has occurred 312 times out of 2516 in the last ten years
  • Of these 312 instances, the stock has seen a positive movement over the next five trading days on 176 occasions
  • This points to a 56% probability for the stock rising over the next five trading days

 

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