Hi Dil ... Commsec Research Insight emailed to me...

Hi Dil ... Commsec Research Insight emailed to me 17/04/11


"Feature Article

Rio Tinto

Last traded: $85.12
Sector: Materials
Market cap: $140,218.14m

Buy Price target: $116.00

Weather impacts but sunny days ahead

On Wednesday 13 April, RIO released its first quarter production report. As expected, all Australian operations were adversely impacted by weather events, with production down across all areas against the bumper December quarter.

Despite this, guidance remained unchanged and we expect 1Q shortfalls to be made up over the remaining three quarters and therefore make no changes to our forecast.

RIO is outstandingly cheap

RIO is outstandingly cheap ? trading on around 8x CY11 Earnings.

We reiterate our Buy recommendation and price target of AUD116.

In comparison to BHP, we find it difficult to split the two stocks. BHP has the higher quality and more balanced asset base and has exposure to spiking oil prices.

However, RIO is cheaper and has a significant aluminium option, which whilst not our preferred commodity, may generate the largest upside ?surprise? in 2011.?"
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Cheers .. tight stops.