Rio Tinto Plc. (RIO:LN) (RIO) PT Lowered to GBP5,150 at HSBC, 'risk-reward is fair at this stage'The analyst commented: "Cut TP to 5,150p (from 5,400p) and reiterate our Hold rating: Our Rio target price is set as the rounded average of DCF at 4,942p (WACC of 9.9%, raised from 9.5%) and 12-month forward EV/EBITDA of 5,374p (multiple of 5.75x, reduced from 6.00x) valuation methodologies. While see the company adding to volumes over the near to medium term through growth at Oyu Tolgoi (Mongolia copper) and Simfer (Simandou/Guinea iron ore), but we think these projects carry above-average risks and therefore are more muted in our view on Rio. To reflect these risks we have increased our WACC (to 9.9% from 9.5%) and reduced our EV/EBITDA multiple (to 5.75x from 6.00x). We reiterate our Hold rating as we think the risk-reward is fair at this stage."