NORILSK NICKEL: Positive Momentum Builds – Upgrade to BUY

We upgrade Norilsk Nickel to an out-of-consensus BUY, increasing our target price to $20/GDR. Norilsk’s shares have lagged the metals basket by 20% and we expect them to rerate when the street starts raising earnings forecasts to factor in the soaring metal prices. Strong data on demand and inventories suggest that positive momentum for the name continues to build, on China’s economic growth outlook and environmental crackdown, and the weak USD. The high-dividend story remains intact with the fu...