Investment bank Goldman Sachs has revised its outlook for Vale SA, suggesting the mining giant's growth potential is constrained as metal prices continue to decline. The firm downgraded the stock rating from "Buy" to "Neutral" and lowered its price target to $16 per share from $18, which represents an 8% upside from last Friday's closing price.

"We now anticipate flat to lower prices for Vale's primary metals, while operational performance has largely been realized. With limited room for improvement due to macroeconomic tailwinds, the copper business faces a longer growth cycle," analyst Maricio Faria wrote in a note to clients on Monday. "Furthermore, since January 2025, the stock has surged over 70%. Following a valuation re-rating, the current valuation has become less attractive."

Over the past three months, Vale SA shares have fallen by 13%, significantly underperforming the broader market. During this same period, the benchmark London Metal Exchange nickel contract, which serves as a global futures indicator for primary nickel, has dropped by about 9%, while the SPDR S&P Metals & Mining ETF has declined by 15%.