7 Best ASX Stocks To Invest In Right Now

1. Rio Tinto (NYSE:RIO)

Number of Hedge Fund Investors in Q2 2024: 29  

Rio Tinto (NYSE:RIO) is a global mining company that operates in over 35 countries and specializes in extracting and producing a wide range of minerals and metals including iron ore, copper, aluminum, and other materials that are crucial for the global energy transition.

Iron ore was the primary revenue generator for Rio Tinto, however, the company is diversifying its operations into aluminum and copper which accounted for 37% of revenue in the first half of 2024. Forbes predicts that aluminum demand will surge by 50% by 2050, driven by the growth of electric vehicles (EVs) and renewable energy infrastructure. Copper demand is expected to grow by 75% over the same period. The World Bank forecasts modest price increases of 2% for aluminum and 4% for copper by 2025.

Rio Tinto’s (NYSE:RIO) key projects including the Resolution project in Arizona have the potential to produce 40 billion pounds of copper over the next 40 years. Other projects such as the Oyu Tolgoi underground copper mine in Mongolia, the La Granja copper project in Peru, and the AP60 aluminum smelter expansion in Canada, are expected to enhance the production capacity of its aluminum and copper products and position the company to benefit from increasing demand.

Rio Tinto’s (NYSE:RIO) stock is currently trading at 8.59 times earnings, the stock is at a 46% discount compared to the sector median of 15.86. In the second quarter, 29 hedge funds held positions in Rio Tinto (NYSE:RIO), with a total value of $1.29 billion. Fisher Asset Management is the largest shareholder, with a stake worth $1.12 billion as of June 30. Industry analysts maintain a consensus Buy rating for the stock, with an average price target of $81.88, indicating a potential upside of 25.64% from its current level.

While we acknowledge the potential of Rio Tinto (NYSE:RIO) to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than RIO but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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