Anglo American target lifted to 4,500p on transformative copper merger

Deutsche Bank has lifted its price target on Anglo American PLC (LSE:AAL) from 3,800p to 4,500p and maintained its buy rating after launching an integrated model combining the mining group with Teck Resources following their merger.

The bank's analysis concludes the combined entity will, on completion, create the world's premier listed copper company, with deal closure assumed at the end of 2026.

The revised target incorporates volume growth expected through to the end of the decade, while a more optimistic scenario of above 5000p assumes a copper price close to current spot levels of around $14,000 per tonne alongside full delivery of targeted merger synergies.

Deutsche Bank flags that both Anglo American and Teck carry histories of operational complexity, including multiple rounds of portfolio simplification and execution challenges.

And it argues that building a consistent and reliable track record will be the critical factor in driving the combined group's valuation multiple towards the upper end of the global copper peer group.

The note includes a detailed benchmarking analysis of the merged business against global copper peers.