|Bid||11.94 x 900|
|Ask||12.11 x 1000|
|Day's range||11.94 - 12.33|
|52-week range||11.94 - 20.25|
|Beta (3Y monthly)||2.53|
|PE ratio (TTM)||6.06|
|Earnings date||24 Oct 2018|
|Forward dividend & yield||0.20 (1.56%)|
|1y target est||17.42|
Freeport-McMoRan (FCX) is scheduled to release its third-quarter earnings results on October 24. Analysts polled by Thomson Reuters expect Freeport to post revenue of $4.5 billion in the third quarter. Freeport posted an adjusted EBITDA of $1.6 billion in the third quarter of 2017.
Freeport-McMoRan (FCX), the leading US-based copper miner (XME), is expected to release its third-quarter earnings on October 24. In this series, we’ll see what analysts are expecting from Freeport’s third-quarter earnings results. The year has been a lackluster one for Freeport as well as the broader metals and mining space.
Rare element metals have become a vital part of U.S. national security this year, with one element in particular making investors extremely excited
So far in this series, we’ve noted that copper’s near-term outlook looks cloudy due to the US-China trade war. However, copper prices have found some sort of support near the price level of $6,000 per metric ton.
Has Freeport-McMoran Stock Finally Bottomed Out? While mining companies have been conservative when it comes to capital expenditures, copper has been a different story. Diversified miners such as BHP Billiton (BHP), Rio Tinto (RIO), and Vale (VALE) have looked open to organic as well as inorganic growth opportunities in copper.
As we noted previously in this series, copper miners such as Southern Copper (SCCO), Rio Tinto (RIO), and First Quantum Minerals (FM) have been subdued this year amid lower copper prices. In a Bloomberg interview, Freeport-McMoRan’s (FCX) CEO, Richard Adkerson, noted that “any strategic move is now possible, including acquisitions, partnerships, or even a sale of the entire company.”
Has Freeport-McMoran Stock Finally Bottomed Out? Copper prices, like other commodities (XME), are impacted by the underlying supply-demand dynamics in the medium to long term. Copper miners such as Freeport-McMoRan (FCX) have noted that despite the trade war tensions, Chinese copper demand has been resilient this year.
As we noted in the previous article, copper prices have sagged this year. Resilient mined copper supply and the US-China trade war have taken a toll on copper prices. The global growth outlook has also become murky amid the US-China trade tensions.
Freeport-McMoRan (FCX) is having a rough year, losing 32.2% of its market capitalization based on its October 12 closing price. Among the other copper miners, Rio Tinto (RIO) and Southern Copper (SCCO) have lost 1.5% and 10.9%, respectively, this year.
Earlier in the year, President Trump authorized doubling the Section 232 tariffs on Turkey after the country’s currency fell. Weak domestic currencies make a country’s exports competitive in the global market. Previously, President Trump wanted to call China a “currency manipulator.” Since he took office, President Trump has backed off.
Towards the end of 2017, the term “synchronized global growth” cropped up. Markets started to price strong global growth in 2018. Copper, an indicator of global economic activity, rallied almost 8% in December 2017 and ended the year with 31.3% gains. Earlier in 2018, the IMF raised its 2018 global economic growth forecast to 3.9% from 3.8%.
First, while China’s steel demand has likely peaked, the country’s copper demand could continue to rise. Copper’s supply dynamics are also different from some of the other metals like steel and aluminum that face structural and chronic overcapacity, especially in China. Most observers expect copper markets to enter into a structural supply deficit in the next decade as existing mines fail to churn out enough metal to meet the demand.
As we discussed previously, several mining companies including Vale and Glencore (GLEN-L) have announced share buybacks in 2018. China’s fixed-asset investment growth rates, which have driven the country’s metal appetite, have fallen to historical lows. The construction boom, which lifted China’s metal demand in the last few years, is also fading quickly.
After the 2015 commodity crash, mining companies like Glencore (GLNCY) and Freeport-McMoRan (FCX) had to suspend their dividend programs. While miners have restored their dividends, they have chosen a flexible dividend policy. Glencore announced its dividend policy.
Copper mining is concentrated in Latin America. The mined copper supply is susceptible to disruptions from protests to nature-related incidents. Aluminum’s supply chain is generally less prone to supply uncertainty compared to copper (FCX).
When the cycle turns for the worse and commodity prices fall, mining companies’ free cash flows also fall. There isn’t much that mining companies can do when commodity prices fall. After the 2008–2009 economic crisis, we saw a sharp rally in metal prices. Copper prices briefly topped the $10,000 per metric ton level in 2011.
The metals and mining industry has seen a lot of action in 2018. For steel and aluminum, President Trump’s Section 232 tariffs lifted US steel prices and physical aluminum premiums to multiyear highs. President Trump clamped down on US steel imports and other regions, especially the European Union, took measures to prevent import deflection after the US tariffs. However, steel prices have been quite resilient globally due to falling Chinese steel exports.
Is President Trump’s Trade Rhetoric Showing Results? The Trump administration has been able to sign new trade deals with countries such as South Korea, and it’s also now successfully renegotiated NAFTA. Other countries such as India and Japan are also looking at trade deals with the United States (DIA).
Freeport-McMoRan Inc. (FCX) announced today that it has entered into a Divestment Agreement on previously agreed economic terms with the Indonesian state-owned enterprise PT Indonesia Asahan Aluminium (Persero) (Inalum) in connection with Inalum’s acquisition of shares of PT Freeport Indonesia (PT-FI). As previously reported, Inalum will acquire for cash consideration of $3.85 billion all of Rio Tinto's interests associated with its Joint Venture with PT-FI (Joint Venture), and 100 percent of FCX's interests in PT Indocopper Investama (PT-II), which owns 9.36 percent of PT-FI.
Investing.com - Stocks in focus in pre-market trade Thursday:· Geron (NASDAQ:GERN) stock slumped 65.32% as of 8:17 AM ET (12:17 GMT) after the company announced that Janssen Biotech terminated a collaboration and license agreement with them.· Rite Aid (NYSE:RAD) stock rose 2.34% after the company posted sales that beat expectations and matched profit expectations, excluding items..· ConAgra Foods (NYSE:CAG) stock fell 6.41% after the company missed its fiscal first-quarter sales and earnings estimates.· Freeport-McMoran (NYSE:FCX) stock increased 1. ...
Freeport-McMoRan Inc. today declared a cash dividend of $0.05 per share payable on November 1, 2018 to holders of record as of October 15, 2018 for its common stock.
NEW YORK, Sept. 25, 2018 -- In new independent research reports released early this morning, Fundamental Markets released its latest key findings for all current investors,.
Last week, we saw another round of tariffs between the US and China (FXI). President Trump announced a 10% tariff on $200 billion worth of goods from China that would be increased to 25% by the end of the year. China retaliated by imposing tariffs on ~$60 billion of goods from the US.
Have President Trump’s Tactics Started to Yield Results? On September 17, President Trump imposed 10% tariffs on $200 billion worth of goods from China. The tariffs will increase to 25% by the end of 2018.