Quick take: Rio Tinto appoints new CEO, Macquarie reiterates $118 PT

• Rio Tinto (ASX: RIO) share price hits 5-year high of $117 per share, up ~16% YTD
• Jakob Stauskholm to replace J-S Jacques as the company’s CEO
• Macquarie analysts describe this appointment as a surprise
• Trade Rio Tinto, long or short with an IG Trading Account now

Rio Tinto on Friday announced that Jakob Stauskholm will be the mining giant’s next Chief Executive Officer. Mr Stauskholm will replace J-S Jacques, with his official start date as CEO set to occur on January 1, 2021.

Since 2018 Mr Stauskholm has worked as Rio Tinto's Chief Financial Officer, playing an instrumental role in the miner’s strong operational performance, according to the company.

Rio Tinto’s Chairman, Simon Thompson, in commenting on this appointment, said:

'I am pleased to announce the appointment of Jakob as Chief Executive of Rio Tinto. His blend of strategic and commercial expertise, strong values and a collaborative leadership style are the ideal qualities for our next chief executive.'

'Jakob has already made a significant contribution to the performance of the Group in his role as Chief Financial Officer. He has a proven track record as a senior executive with deep industrial resources experience spanning strategy development technology, as well as financial and risk management,’ Mr Thompson finished.

This CEO-switch up follows from the Juukan Gorge incident, which saw Rio Tinto blow up the 46,000 year-old Aboriginal heritage site, located in the Pilbara region of Western Australia.

Justifiable outcry followed from the ‘inexcusable’ actions which led to the destruction of the sacred site, with J-S Jacques eventually resigning as CEO of Rio Tinto in response.

Rio Tinto share price breaks new highs

Despite being mired in controversy, the Rio Tinto share price has pushed higher in 2020 – buoyed by steadily rising iron ore prices. At the time of writing, RIO traded at $117.63 per share – a 5-year high for the stock.

Commenting on today's announcement regarding Rio Tinto’s management change-up -- Macquarie Wealth Management, who have long held a bullish view on the miner (Rating: Outperform; PT: $118.00 per share) said:

‘The move to appoint the new Chief Executive Officer from internal ranks was a surprise as we had expected RIO’s Board to appoint an external candidate from the process.’

Surprise or not, a strong iron ore market continues to act as a key tailwind for Rio Tinto, with the investment bank further saying:

‘Buoyant iron-ore prices continue to underpin strong earnings upgrade momentum for RIO. A spot price scenario generates 68% and 144% higher earnings for CY21 and CY22 respectively.’

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