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RIO heads into its October 21 earnings release having shed 7% over the past month, with positioning data that remains notably relaxed despite the stock's continued weakness.
The borrow market picture has not changed materially since the October 14 production report preview. Availability has eased slightly from the 4,300%-plus level flagged then to a still-extreme 4,257%, meaning shares to borrow are abundant relative to existing short positions. Cost to borrow has fallen further, now at 0.31%, down around 13% on the week. Short interest itself is steady at roughly 9.3 million shares, having dropped about 5% from mid-September highs near 10 million and shown little movement over the past week. That is a lender's market, not a short-seller's conviction trade. Options tell a similar story: the put/call ratio of 0.71 sits only modestly above its 20-day average of 0.67, a z-score of just 0.73, and well short of the 52-week peak near 1.08. Positioning, in short, looks relaxed rather than charged.
The analyst picture is more divided. Morgan Stanley initiated with an Underweight rating in late August, setting a target of $90, essentially in line with where the stock trades today at $90.32. That call sits in contrast to Bernstein, which lifted its target to $89.50 in September while maintaining an Outperform. The consensus mean target of $103 implies meaningful upside, though that figure aggregates a range of views that includes JP Morgan's March downgrade to Neutral and Barclays' move to Equal-Weight earlier in 2026. Bulls point to RIO's dividend yield, which ranks in the 97th percentile on ORTEX's factor scoring and reflects a stock generating strong cash returns. Bears focus on deteriorating earnings momentum: the EPS momentum score sits in the 27th percentile on a 30-day basis and the 35th percentile over 90 days, consistent with estimates being revised lower heading into the print. The P/E multiple at 10.6x has contracted by about 0.7 turns over the past month, tracking the price decline.
The reaction history adds some context. The last three earnings events produced positive first-day moves of 6%, 2.6% and 1.9% respectively, each followed by further gains of 7% to 11% over the subsequent five sessions. That is a consistently constructive pattern, though it came against a backdrop of rising estimates rather than the current negative earnings momentum.
The October 21 print will be less about the headline numbers and more about whether management can offer enough clarity on iron ore volumes, copper ramp-up progress and cost guidance to give the bull case fresh legs after a bruising few months for the stock.
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