Morningstar

Which UK Mining Stocks Are Attractively Valued?

Rising gold and silver prices and increased demand for copper make these the mining stocks to watch.

Collage illustration featuring mines, industrial equipment, and infrastructure within a pie chart.

Key Takeaways

  • UK-listed mining stocks with precious metals exposure are supported by rising gold and silver prices.
  • Silver producer Fresnillo is the runaway star of the sector, its shares up 151% in the year to date.
  • Expansion of AI technology is driving global demand for copper.

UK-listed mining stocks have had a volatile year amid rising geopolitical tensions and a rapidly changing outlook for global trade. Despite these headwinds, analysts argue the long-term outlook remains positive, certainly as long as China drives demand. A rising appetite for safe-haven investments like precious metals, as well as future demand for metals needed to power artificial intelligence, has put mining stocks back on investors’ radar.

However, it has been far from smooth sailing in 2025 for Rio Tinto RIO and Anglo American AAL, two mining giants focused on base metals. Shares in Rio, the largest mining stock in the FTSE 100, have fallen this year alongside the price of iron ore, a key part of the firm’s portfolio. The stock now screens as undervalued. Meanwhile, UK-listed Mexican silver miner Fresnillo FRES has made triple-digit gains over this period. Which stocks have been performing well, and why?

Rio Tinto

Rio Tinto has delivered poor returns for investors in 2025, underperforming Morningstar’s fair value estimate. Rio’s shares are down 6.48% so far this year at £44.53, below Morningstar’s £56.00 target.

Rio Tinto shares were caught up in the market rout triggered by US President Donald Trump’s tariffs. The stock has slowly recovered since, but market watchers will be keeping a close eye on whether Trump’s tariff regime leads to a slowdown in economic growth and therefore demand for commodities.

Pretax profits in the first half of 2025 fell, hit by weaker iron ore prices and cyclone disruptions in Western Australia, which eroded the gains made from higher aluminium and copper prices. Morningstar analyst Jon Mills says the company’s largest customer by far is China, accounting for around 60% of sales last year. But he warns that with China’s boom in infrastructure and real estate investment having weakened over the last few years, any softening in demand from China for commodities could hit Rio’s earnings outlook.

Anglo American

Investors in Australian miner Anglo American have seen its share price fall even further than Rio’s. The stock recorded a drop of over 8% to £21.55 per share, leaving it trading slightly above its fair value estimate of £19.50.

Yet, as with Rio, Mills has maintained the stock’s fair value estimate on broadly unchanged iron ore prices. The mining stalwart saw a significant decline in its pretax profit in the six months to the end of June 2025 of USD 1.5 billion, a sharp drop from the USD 2.3 billion it recorded the year before.

The disappointing results were driven in part by lower diamond volumes and prices, as well as reduced copper volumes, due to lower copper recoveries, and the planned closure of the smaller Los Bronces processing plant in July 2024, which dented production versus H1 2024.

Anglo American has stakes in some large, low-cost, and long-life copper mines, including a 60% stake in Peruvian mine Quellaveco and a 44% share of the Collahuasi mine in Chile. According to Mills, copper and iron ore are where Anglo is refocusing its core business.

The miner is looking for a buyer for its diamond division, De Beers, which weighed on first-half earnings with a USD 189 million loss amid softer global demand. It has already sold its steelmaking coal arm to US miner Peabody Energy for USD 4.9 billion, marking a complete withdrawal from its coal operations in Australia, and it sold its Brazilian nickel business to MMG Singapore Resources for USD 500.0 million.

Glencore

Of the three UK-listed miners covered by Morningstar, Glencore screens as the most undervalued. The four-star stock trades at a 37% discount to its fair value estimate, weighed down by weaker near-term thermal and metallurgical coal prices.

Coal is changing hands at USD 110.90 a ton, a marked drop from last year’s USD 147.00 price. So far this year, Glencore stock has lost over 19% to trade at £293.10 per share.

Despite this, Mills believes Glencore is better positioned than Rio and Anglo American, due to its existing mining operations. “Demand for high-quality thermal and met coal will remain persistent while prices are also likely to be supported by ESG considerations leading to constrained supply. It is difficult to obtain approval to extend or expand existing mines, let alone build new ones, in the West in particular,” he says.

Richard Marwood, head of UK and European Equities at Royal London, says Glencore’s breadth and diversity of its operations leave it well placed for future success. The group’s portfolio spans coal, copper, zinc-nickel and alloys.

However, Mills argues that a shift or reduction in Chinese demand for these commodities could stunt the benefits of Glencore’s diversification. “These include slowing urbanization, a falling population, lower return on infrastructure investments, and its likely transition to a less-commodity-intensive consumption-focused economy,” he warns.

Fresnillo

Fresnillo, the world’s largest silver producer and Mexico’s biggest gold producer, is the FTSE 100’s top performer this year, with shares are up 151% in the year to date.

Global events have created strain in the firm’s supply chain and driven costs higher. More locally, changing government policies in Mexico, which have affected the permitting process, as well as the stronger peso, have had an impact. The stock has been supported by rising gold and silver prices.

As Georges Lequime, comanager of the Silver-rated WS Amati Strategic Metals Fund, explains: “In the last two years, we’ve had the gold price up about 84% and the silver price up about 70%. The Mexican peso weakened quite significantly, too. And the interesting part is that cost inflation, which encompasses labor, materials, energy, and contract mining, reported a 2.3% annualized inflation [rate]. So cost inflation has come down, and revenue have gone up dramatically.”

Lequime says safe-haven assets like gold and silver, which are always popular diversifiers for investors, are seeing a boost because of the weakening US dollar. “Faith in fiat currencies is diminishing as the market worries about monetary policy moving forward,” he says.

Fresnillo delivered stellar first-half results, posting pretax profits of USD 860.8 million, up 266% on last year. CEO Octavio Alvídrez says the rise was not just down to higher precious metals prices, but also “consistent operational performance and rigorous cost discipline.” He expects gold output to rise, buoyed by robust production at its Herradura mine, while silver production forecasts remain unchanged.

Antofagasta

The expansion of AI technology is driving global demand for copper, as it is an essential component in data center infrastructure, used for power supply, cooling systems, and internal connectivity. That’s good for UK-listed Chilean copper miner Antofagasta ANTO, which is up over 30% and closed at £21.15 per share on Aug. 20.

Copper production reached around 314,900 tons in the first half of 2025, representing an 11% year-on-year increase, driven by higher output from the group’s two principal mines, Centinela Concentrates and Los Pelambres. At the half-year stage, the company reported pretax profits of USD 1.16 billion, a 63% increase on last year’s level.

CEO Iván Arriagada said, “our growth program continues to advance at Los Pelambres and Centinela, with capital investment expected to increase in the second half, and work on schedule to position Antofagasta as one of the highest copper growth companies amongst our pure-play peers, with an expected +30% growth in output in the medium-term.”

Copper prices hit a record high in July 2025, but fell from USD 5.57 to USD 4.54 on July 29, after the announcement from the US government that copper imports would be included in its tariff regime. Copper futures are currently trading at USD 4.40 per pound, down 0.28% over the past year.

Still, AJ Bell’s Russ Mould believes Antofagasta is positioned well for long-term growth, as copper is also a key component in wind, solar, and hydro energy, as well as electric vehicles and batteries. And its dominance in the sector could make it a takeover target. “Antofagasta’s focus on copper might make it an acquisition target, although the presence of a controlling shareholder in the form of the Luksic family is a potential complicating factor,” he explains.

The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar's editorial policies.

© Copyright 2026 Morningstar, Inc. All rights reserved.