Top broker tips Mineral Resources share price to rise 25%

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The Mineral Resources Limited (ASX: MIN) share price was a strong performer in April.

The mining and mining services company’s shares stormed 15% higher during the month.

Can the Mineral Resources share price keep rising?

The good news for investors is that one leading broker believes the Mineral Resources share price can keep climbing from here.

According to a note out of Goldman Sachs, its analysts have retained their buy rating and lifted their price target to $73.80.

Based on the current Mineral Resources share price of $58.54, this implies potential upside of 26% over the next 12 months.

Why is the broker so bullish?

There are a few reasons for Goldman’s bullish view on the Mineral Resources share price. This includes its compelling volume and earnings growth outlook and favourable iron ore and lithium prices. It explained:

“Compelling volume and earnings growth: We forecast a more than doubling of group EBITDA to over A$2bn in FY23 driven by higher lithium and low grade iron ore prices, and a 5% increase to mining services volumes to ~300Mt. Over the next 5yrs we expect MIN’s mining services volumes to increase ~50% to over 400Mtpa, lithium volumes to triple, and iron ore equity volumes to nearly double.

“Lithium spodumene price have settled at around US$4,500/t for the June Q. We are positive iron ore near term also – we forecast Fe to average US$145/t in 2Q22 (but see upside risk to this forecast on near term SD outlook) with seasonal weakness in Aus & Brazil supply from wet weather and an expected recovery in Chinese steel production. At spot lithium & iron ore our FY23 EBITDA would increase to >A$3bn.”

All in all, this could make Mineral Resources shares worth considering if you’re looking for exposure to the resources sector.

The post Top broker tips Mineral Resources share price to rise 25% appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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