Cap Rises in Chile as Investors Snap Stock at 3-Month LowEduardo Thomson
Cap SA, Chile’s largest iron-ore producer, rose the most in seven weeks after the stock yesterday fell to a three-month low.
Cap advanced 1.8 percent to 15,648 pesos at the close of trading in Santiago, the biggest gain since Jan. 25. The stock was the second-most actively traded on the Santiago exchange today, with volume more than three times the average of the last three months.
The shares had fallen for six straight days, a cumulative plunge of 8.1 percent, as analysts including Morgan Stanley and Deutsche Bank AG cut their iron-ore price forecasts. In China, iron ore prices have slumped 15 percent after reaching their 2013 high on Feb. 20, according to data compiled by The Steel Index Ltd.
“The punishment to Cap’s shares may have been a bit excessive,” Felipe Ruiz, an analyst at BCI, said in a phone interview today from Santiago.
Iron-ore sales accounted for 50 percent of Cap’s revenue in 2012, according to data compiled by Bloomberg. BCI has a neutral recommendation and a target price of 18,050 pesos per Cap share by year end, Ruiz said. That is 15 percent above today’s close.
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