Rio Tinto plc (ADR)(NYSE:RIO): Reasons For Buying Or Not Buying The Stock – GLEN


Dallas, Texas 04/03/2014 (FINANCIALSTRENDS) –  Rio Tinto plc (ADR)(NYSE:RIO) has received a lot of positive feedback and comments in press during the last few months. The company has worked very hard to drive their profits higher. They have also focused on improving the cash flow and cash returns to the investors. However, there is another stock in the market named Glencore Xstrata PLC (LON:GLEN) and has been working even harder. This has resulted in the company earning billions of dollars. All this is the result of the company’s merger with Xstrata last year and apart from this there are many new projects on the way, speeding up the growth. So there is a speculation that should the investors turn their back on RIO for Glencore?

Why you should not go for Rio?

The company’s marketing business is the biggest strength of Glencore compared to its competitors. If one has to be specific the company excels in many areas i.e. Glencore provides, does shipping and trading of commodities of all types and they do it in all parts of the world. The company is known to have a defensive marketing strategy. Such defensive strategy has helped the company from saving itself from the jerk that was caused by the downturn in the mining business.

Why you should go for Rio?

Even if there are many attractive qualities that Glencore has, still the company is fundamentally, a coal and copper mining company. Unfortunately, in recent times the prices of both coal and copper has seen a downfall in their prices and this is the reason why Glencore is most likely to suffer.

Rio Tinto plc (ADR)(NYSE:RIO) is fundamentally an iron ore mining company. Another key advantage that Rio has over Glencore is a lower level of debt. Despite of all this Glencore is a good investment for a long-term.