"Believe In AI, Believe In Copper, Believe In Glencore"

Goldman Sachs analyst James McGeoch published a note on Friday, informing clients that commodity mining and trading giant Glencore could be one of the most straightforward plays on rising copper prices, driven by AI-related demand and tightening commodity markets. He noted that Glencore's upside potential extends beyond being undervalued, with a potential catalyst for a stock buyback program announcement.

"Why I like Glencore and think the bottom could be in - Mkt has hammered Glencore for poor prodn profile, margin compression, pessimistic commodity outlook, high beta, tariffs proxy and has become a value trap," McGeoch said. 

He continued, "To change the direction of travel they need to: Start buying back own stock. Take prodn offline to show "value" over "volume". Improve the margin per unit by tightening the mkt (balances are tight enough for small changes to allow it). Reduce capex, spin that into higher long term capital returns."