Anglo American's share price declined 0.75% on Friday, closing at 3,435 pence, following a rating downgrade from Bank of America Global Research. The bank shifted its stance to "neutral" from a more bullish view, expressing concerns over the miner's valuation and the execution risks surrounding its strategic overhaul.
Valuation and Catalysts in Focus
While BofA raised its price target to 3,600 pence from 3,500 pence, analysts noted the recent stock rally has largely absorbed near-term upside potential. They highlighted a prolonged wait for synergies from the planned merger with Teck Resources and significant uncertainty regarding the future of the De Beers diamond unit, which is carried on Anglo's books at approximately $4 billion.
The company faces a critical period as it refocuses on copper production amid strong prices for the metal, driven by electrification trends. However, legacy divisions like diamonds and coal continue to demand management attention and capital. Investors are awaiting clearer execution timelines, with the next major update scheduled for February 20, when full-year results and details on asset sales are due.
Diverging Analyst Views and Operational Updates
Not all analysts are pessimistic. Deutsche Bank maintained a "Buy" rating with a 3,500 pence target, anticipating a rebound in copper volumes and progress on planned disposals. This contrasts with BofA's caution over a stalled coking coal sale and the complex separation of De Beers.
Operationally, Anglo recently revised its 2026 copper production target down to a range of 700,000–760,000 tonnes, citing weaker output at the Collahuasi mine in Chile. De Beers' guidance was also reduced for 2026 to 21–26 million carats, attributed to soft demand and high inventory levels. Looking further ahead, the company introduced its first copper production guidance for 2028, targeting 790,000–850,000 tonnes, contingent on water availability.
CEO Duncan Wanblad announced the temporary restart of a second plant at the Los Bronces operation to offset the grade issues at Collahuasi, citing a supportive copper price environment. The company remains committed to its all-stock, nil-premium merger proposal for Teck Resources, valued at $53 billion.
Market participants will now watch for regulatory developments on the Teck deal, concrete steps on the De Beers review, and progress on coal asset sales. While copper prices will influence daily sentiment, company-specific headlines around these strategic moves are likely to drive significant stock price movement in the coming weeks.