J.P. Morgan resumes Glencore coverage with “overweight,” £3.60 price target

Published 08/07/2025, 08:20
© Reuters.

Investing.com -- J.P. Morgan has resumed coverage of Glencore (LON:GLEN) with an “overweight” rating and a £3.60 price target for December 2026, implying a potential 20% upside, in a note dated Tuesday.

The brokerage cited improving production, capital returns, and the company’s strategic flexibility as key drivers for its more positive outlook.

J.P. Morgan said Glencore has underperformed the MSCI Europe index by 45% since May 2024, largely due to weak operational results and a decline of more than 25% in coal prices. 

However, the brokerage expects a strong recovery in the second half of 2025, driven primarily by a significant step-up in copper output.

Group earnings are forecast to rise approximately 150% in 2026 and 250% in 2027 compared to 2025 levels. 

J.P. Morgan projects Glencore will return about 6% of its market capitalization to shareholders in 2025. 

Additionally, if commodity prices rise 10%, the bank estimates excess capital of 7% by the end of 2026 and 20% by 2027.

While coal prices have weighed on Glencore’s share price, J.P. Morgan notes potential upside. 

The brokerage points out that roughly 60% of global energy coal supply and 30% of steelmaking coal supply are currently operating at cash losses, suggesting price support or recovery may follow over a 12-month horizon.

J.P. Morgan also explores the impact of a hypothetical de-merger of Glencore’s coal assets. 

The analysts suggest this move could act as a rerating catalyst, potentially lifting the company’s valuation by 15–20%, toward £3.50–3.70 per share.

The upgrade comes as a two-year restriction tied to Glencore’s merger of Viterra with Bunge (NYSE:BG) Global ends, allowing for a fresh reassessment. 

According to J.P. Morgan, Glencore holds “value-accretive strategic optionality,” and its capital flexibility and asset mix support a more constructive investment case.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers
© 2007-2025 - Fusion Media Limited. All Rights Reserved.