South32 Ltd (ASX: S32) shares have been having a tough time of late.
Since this time last month, the mining giant's shares have dropped 12%.
This leaves them trading within sight of their 52-week low.
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Should you snap up South32 shares?
A number of brokers appear to see this recent weakness as a buying opportunity.
For example, UBS currently has a buy rating and a $4.30 price target on the miner's shares and Morgan Stanley has an overweight rating and a $4.15 price target on them. Both price targets imply over 20% upside from the current levels for investors.
The team at Morgans is even more bullish. It has an add rating and a $5.20 price target on South32's shares. This suggests an upside of 50% could be on the cards over the next 12 months.
The broker recently commented that it is "viewing S32 as representing attractive long-term value at current levels."
In addition, the broker has previously noted the great work the company has done transforming its portfolio and highlighted its favourable dividend policy. The broker said:
S32 has transformed its portfolio by divesting South African thermal coal and acquiring an interest in Chile copper, substantially boosting group earnings quality, as well as S32's risk and ESG profile. Unlike its peers amongst ASX-listed large-cap miners, S32 is not exposed to iron ore. Instead offering a highly diversified portfolio of base metals and metallurgical coal (with most of these metals enjoying solid price strength). We see attractive long-term value potential in S32 from de-risking of its growth portfolio, the potential for further portfolio changes, and an earnings-linked dividend policy.
All in all, these analysts appear to believe that South32 could be worth considering if you are looking for exposure to the mining sector right now.
