Trading Recommendations - Sell November 45 calls for Freeport McMoran (FCX) [1] - Consider American Express, noting the stock is down approximately 10% over the past month [2] - Buy volatility as a just-in-case trade [2] Market Observations - Gen Z and millennials show affinity for American Express [2] - Expect a pickup in M&A activity to benefit private equity and traditional big banks [2]

Group 1 - Hudbay Minerals dropped over 4%, while Freeport-McMoRan, Southern Copper, and Ero Copper fell more than 2% [1] - The Chilean National Copper Corporation significantly revised down its copper production growth forecast for 2025, now expecting a 1.5% increase compared to last year's figures, which is only half of the growth predicted in May [1] - The downward revision in production growth is attributed to a decline in output from BHP's Escondida mine (the world's largest copper mine) and the Collahuasi mine operated by Anglo American and Glencore [1]

Group 1 - The core viewpoint of the article highlights a collective decline in U.S. copper stocks, with major companies like Rio Tinto and BHP experiencing notable pre-market drops due to revised copper production forecasts from Chile's National Copper Corporation [1] - Chile's National Copper Corporation has significantly lowered its 2025 copper production growth forecast to 1.5%, which is half of the previously predicted 3% increase made in May [1] - The downward revision in production growth is attributed to decreased output from major mines, specifically BHP's Escondida mine and the joint-operated Coya Sur mine by Anglo American and Glencore, which saw a decline in June production [1] Group 2 - Pre-market performance shows Rio Tinto down nearly 2% at $63.570, BHP down 1.4% at $54.730, Freeport-McMoRan down 0.54% at $42.740, and Southern Copper down 0.20% at $99.500 [1] - The article provides specific stock price changes and percentages, indicating a broader trend of declining investor confidence in copper-related equities amid production concerns [1]

Investment Rating - The report rates the industry as "Outperforming the Market" [4] Core Insights - The copper mining industry is experiencing significant supply disruptions, leading to a clear pattern of scarce incremental production for the year [14][15] - The total production guidance for the ten major copper mining companies is projected to be 9.759 million tons for 2025, which represents a decrease of 57,000 tons compared to the actual production in 2024 [14][17] - Major companies are struggling to meet their production guidance, with most achieving less than 50% of their annual targets by mid-2025 [15] Summary by Sections 1. Overview of Supply Disruptions - The report tracks ten major copper mining companies, including Freeport, Codelco, BHP, and others, highlighting frequent supply disruptions in the first half of 2025 [13][14] - The average production for these companies in Q2 2025 increased by 5% quarter-on-quarter but decreased by 2% year-on-year [14][16] 2. Company-Specific Updates Freeport - Freeport's production guidance has been adjusted downwards due to challenges at the Grasberg mine, with a new target of 1.79 million tons for the year [15][18] - The company has a rich asset portfolio with significant copper, gold, and molybdenum reserves [18] Codelco - Codelco's production recovery efforts are hindered by mining accidents, affecting its output and guidance [15] BHP - BHP reported a slight increase in copper production in Q2 2025, but its long-term production guidance indicates a decline in ore grades [15][17] Glencore - Glencore's copper production is under pressure, with expectations of continued declines in 2025 [15] Southern Copper - Southern Copper's production remains stable, with expected increases primarily in the long term [15] First Quantum - First Quantum faces challenges in production recovery, particularly at its Cobre Panama mine [15] Anglo American - Anglo American's production is under pressure due to declining ore grades, impacting overall output [15] Rio Tinto - Rio Tinto's Oyu Tolgoi underground mine is expected to contribute significantly to future production, although current output is still being ramped up [15] Antofagasta - Antofagasta is expanding its operations to mitigate the impact of declining ore grades [15] Teck Resources - Teck Resources has adjusted its production guidance downward due to limitations at its QB2 project [15]

Freeport-McMoRan is selling large volumes of copper ore following an outage at a plant it owns in Indonesia, bringing short-term relief to smelters facing a historic squeeze on supply https://t.co/KCMvF1YfHo ...

Core Viewpoint - Morgan Stanley upgraded Freeport-McMoRan Inc (NYSE:FCX) to "overweight" from "equal weight," while reducing its price target to $48 from $54, indicating a belief in balanced potential for the mining stock due to President Trump's copper tariffs [1] Group 1: Stock Performance - FCX was down 1.1% trading at $41.41, facing resistance at the 320-day moving average, which has fluctuated between support and resistance since the beginning of the year [2] - The stock has increased by 9.1% since the start of the year, despite a decline in late July related to initial copper tariff discussions [2] Group 2: Short Interest and Options - Recent stock rebound may be linked to short covering, with short interest decreasing by 24.5% in the last two weeks, now representing only 1.7% of the stock's available float, suggesting a potential loss of momentum in the short squeeze [3] - Options appear to be a favorable strategy, as the stock's Schaeffer's Volatility Index (SVI) of 35% ranks in the low 6th percentile of its annual range [3]

Core Viewpoint - Dividend stocks are positioned as attractive investment opportunities amid economic recovery, particularly in key industries like logistics, copper mining, and semiconductors [3][11][17]. Group 1: United Parcel Service (UPS) - UPS stock has declined by 28% since the beginning of the year, contrasting with an 8.3% rise in the S&P 500, presenting a buying opportunity [5][6]. - The decline is attributed to year-over-year decreases in revenue and earnings due to higher costs and uncertainties regarding international trade policies [7]. - Management aims for $3.5 billion in cost reductions in 2025 through network reconfiguration and Efficiency Reimagined initiatives, indicating potential for future growth [8]. - UPS has maintained a 76.9% average payout ratio over the past five years, suggesting a commitment to shareholder returns despite current challenges [9]. Group 2: Freeport-McMoRan - Freeport-McMoRan's stock price fell after the Trump administration exempted refined copper imports from tariffs, impacting the company's market position [11][12]. - Despite the recent downturn, management projects $8.5 billion in operating cash flow at a copper price of $4 per pound, and $11 billion at $5 per pound, indicating strong future cash flow potential [13]. - The current market cap of $56 billion implies a price to operating cash flow of 5.9 times, which is considered cheap historically [14]. - The stock offers a 1.5% yield, making it an attractive value proposition regardless of tariff implications [16]. Group 3: Texas Instruments (TI) - TI experienced a sell-off despite reporting a 16% increase in revenue and earnings per share, primarily due to weakness in key markets like automotive and ongoing tariff risks [18]. - The company is well-positioned for steady growth, producing essential components across various sectors, including automation and medical equipment [19]. - TI's vertically integrated manufacturing approach provides greater control over its supply chain compared to fabless competitors [20]. - With a 2.9% dividend yield, TI stands out in the tech sector, especially when compared to other dividend-paying chip stocks [21]. - The current P/E ratio of 35.8 reflects cyclical valuation, but long-term earnings growth potential remains strong, with consensus estimates suggesting a 28.4 P/E ratio by 2026 [22][23].

Part I [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) Unaudited consolidated financial statements for Q2 2025 show increased revenue and net income, driven by higher sales and commodity prices [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) Total assets increased to **$56.5 billion** by June 30, 2025, with total equity rising to **$30.0 billion** Consolidated Balance Sheet Highlights (in Millions) | Account | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | **Total Current Assets** | $13,636 | $13,296 | +$340 | | **Property, plant, equipment, net** | $39,835 | $38,514 | +$1,321 | | **Total Assets** | **$56,492** | **$54,848** | **+$1,644** | | **Total Current Liabilities** | $5,531 | $5,496 | +$35 | | **Long-Term Debt** | $8,913 | $8,907 | +$6 | | **Total Liabilities** | **$26,496** | **$26,070 | **+$426** | | **Total Stockholders' Equity** | $18,208 | $17,581 | +$627 | | **Total Equity** | **$29,996** | **$28,778** | **+$1,218** | [Consolidated Statements of Income](index=5&type=section&id=Consolidated%20Statements%20of%20Income) Q2 2025 revenues rose to **$7.58 billion**, increasing net income to **$772 million**, with six-month revenues at **$13.31 billion** Income Statement Summary (in Millions, Except Per Share Data) | Metric | Q2 2025 | Q2 2024 | YoY Change | 6M 2025 | 6M 2024 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Revenues** | $7,582 | $6,624 | +14.5% | $13,310 | $12,945 | +2.8% | | **Operating Income** | $2,432 | $2,049 | +18.7% | $3,735 | $3,683 | +1.4% | | **Net Income Attributable to Common Stockholders** | $772 | $616 | +25.3% | $1,124 | $1,089 | +3.2% | | **Diluted EPS** | $0.53 | $0.42 | +26.2% | $0.77 | $0.75 | +2.7% | [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operations for H1 2025 decreased to **$3.25 billion**, while cash used in financing activities declined to **$0.91 billion** Cash Flow Summary - Six Months Ended June 30 (in Millions) | Cash Flow Category | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | **Net Cash Provided by Operating Activities** | $3,253 | $3,852 | -$599 | | **Net Cash Used in Investing Activities** | ($2,432) | ($2,385) | -$47 | | **Net Cash Used in Financing Activities** | ($908) | ($1,128) | +$220 | | **Net (Decrease) Increase in Cash** | ($87) | $339 | -$426 | [Notes to Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Detailed notes cover accounting policies, a **37%** effective tax rate, **$9.25 billion** total debt, share repurchases, and Indonesian regulatory updates - The consolidated effective income tax rate was **37%** for the first six months of 2025, up from **34%** in the same period of 2024[25](index=25&type=chunk) Debt Components (in Millions) | Debt Category | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | PTFI revolving credit facility | $250 | $250 | | Senior notes and debentures | $8,620 | $8,617 | | Other | $381 | $81 | | **Total debt** | **$9,251** | **$8,948** | - During the first six months of 2025, the company repurchased **2.9 million** shares of common stock for **$107 million**. As of July 31, 2025, **$3.0 billion** remains available under the share repurchase program[33](index=33&type=chunk) - PTFI received a copper concentrate export license through September 16, 2025, and is subject to a **7.5%** export duty. A new regulation effective March 1, 2025, requires **100%** of export proceeds to be deposited in Indonesian banks for **12 months**[67](index=67&type=chunk)[68](index=68&type=chunk) [Management's Discussion and Analysis (MD&A)](index=27&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, operational results, and strategic outlook, including the new PTFI smelter and 2025 sales projections - A major milestone was achieved with the startup of PT Freeport Indonesia's (PTFI) new large-scale copper smelter in Eastern Java, Indonesia, slightly ahead of schedule[93](index=93&type=chunk) - The company is targeting an annual run rate of **300 million pounds** of copper by the end of 2025 from new applications, technologies, and data analytics in its leaching processes[94](index=94&type=chunk) - Net debt totaled **$1.5 billion** at June 30, 2025, excluding **$3.2 billion** of debt for PTFI's downstream processing facilities[97](index=97&type=chunk) [Outlook](index=28&type=section&id=Outlook) The 2025 outlook projects **3.95 billion pounds** of copper sales, **$7.0 billion** in operating cash flow, and **$4.9 billion** in capital expenditures Projected 2025 Consolidated Sales Volumes | Metal | Projected Volume | | :--- | :--- | | Copper | 3,948 million lbs | | Gold | 1.3 million oz | | Molybdenum | 82 million lbs | Projected 2025 Capital Expenditures (in Billions) | Category | Amount | | :--- | :--- | | Major projects | $2.7 | | PTFI's downstream processing facilities | $0.6 | | Sustaining capital and other | $1.6 | | **Total** | **$4.9** | - Consolidated operating cash flows are estimated to be approximately **$7.0 billion** for 2025, assuming average prices of **$4.40/lb** for copper and **$3,300/oz** for gold for the second half of the year[105](index=105&type=chunk) [Markets](index=30&type=section&id=Markets) Market analysis covers copper, gold, and molybdenum prices, noting the impact of U.S. tariffs on copper and gold's record high in Q2 2025 - Following a U.S. presidential proclamation on July 30, 2025, imposing a **50%** tariff on certain copper imports, COMEX copper prices declined to become similar to LME prices, consistent with historical trends[111](index=111&type=chunk) Q2 2025 Average Commodity Prices | Commodity | Exchange/Source | Average Price | | :--- | :--- | :--- | | Copper | LME | $4.32 / lb | | Copper | COMEX | $4.72 / lb | | Gold | London PM | $3,280 / oz | | Molybdenum | Platts Metals Daily | $20.66 / lb | [Consolidated Results](index=32&type=section&id=Consolidated%20Results) Q2 2025 consolidated revenues increased **14.5%** to **$7.6 billion**, driven by higher copper and gold sales volumes and realized gold prices Consolidated Sales and Realized Prices (Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Copper Sales (M lbs) | 1,016 | 931 | +9.1% | | Avg. Realized Copper Price | $4.54/lb | $4.48/lb | +1.3% | | Gold Sales (k oz) | 522 | 361 | +44.6% | | Avg. Realized Gold Price | $3,291/oz | $2,299/oz | +43.2% | - The increase in Q2 2025 consolidated revenues was primarily driven by higher gold sales volumes (**+$373 million**), higher gold prices (**+$517 million**), and higher copper sales volumes (**+$379 million**)[128](index=128&type=chunk) [Operations](index=38&type=section&id=Operations) Operational performance is detailed by segment, covering production initiatives, technology innovations, and the impact of U.S. tariffs on development and costs - The company is the leading copper supplier in the U.S., providing approximately **70%** of total U.S. refined copper production. For H1 2025, U.S. copper was sold **63%** as rod, **26%** as cathode, and **11%** in concentrate[161](index=161&type=chunk) - A potential expansion project at the Bagdad operation in Arizona could more than double its concentrator capacity, adding **200-250 million pounds** of copper production per year for an estimated capital cost of **$3.5 billion**[167](index=167&type=chunk)[168](index=168&type=chunk) - PTFI expects to apply for an extension of its mining rights beyond 2041 during 2025, contingent on an agreement to transfer an additional **10%** interest to Indonesia's state-owned enterprise, MIND ID[198](index=198&type=chunk) [Capital Resources and Liquidity](index=51&type=section&id=Capital%20Resources%20and%20Liquidity) The company maintains strong liquidity with **$4.5 billion** cash, targeting **$3.0-$4.0 billion** net debt, and paid **$0.4 billion** in H1 2025 dividends Net Debt Calculation (as of June 30, 2025, in Millions) | Item | Amount | | :--- | :--- | | Consolidated debt | $9,251 | | Less: consolidated cash and cash equivalents | $4,490 | | **FCX net debt** | **$4,761** | | Less: debt for PTFI's downstream processing facilities | $3,234 | | **FCX net debt (excluding PTFI project debt)** | **$1,527** | - The company's financial policy includes a base dividend and a performance-based framework where up to **50%** of available cash flow is allocated to shareholder returns, subject to maintaining its net debt target[238](index=238&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=72&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes to market risks occurred during H1 2025, with detailed information available in the 2024 Form 10-K - There have been no material changes in the company's market risks during the first six months of 2025[307](index=307&type=chunk) [Controls and Procedures](index=72&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal controls - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[312](index=312&type=chunk) Part II [Legal Proceedings](index=72&type=section&id=Item%201.%20Legal%20Proceedings) No material changes to legal proceedings were reported, and management anticipates no material adverse effect on financial condition - There have been no material changes to previously disclosed legal proceedings[311](index=311&type=chunk) [Risk Factors](index=73&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the company's risk factors have occurred since the 2024 Form 10-K filing - There have been no material changes to the company's risk factors since the 2024 Form 10-K filing[313](index=313&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=73&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased **1,532,129** common shares in Q2 2025, with **$3.0 billion** remaining available under the repurchase program Share Repurchases for Quarter Ended June 30, 2025 | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | April 2025 | 847,965 | $29.48 | | May 2025 | 185,427 | $37.75 | | June 2025 | 498,737 | $40.10 | | **Total** | **1,532,129** | **$33.94** | [Mine Safety Disclosures](index=73&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) The company prioritizes health and safety through its "Safe Production Matters" strategy, with detailed mine safety data in Exhibit 95.1 - The company's global health and safety strategy, "Safe Production Matters," is focused on fatality prevention and continuous improvement, with a goal of achieving zero workplace fatalities[315](index=315&type=chunk) [Other Information](index=73&type=section&id=Item%205.%20Other%20Information) No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during Q2 2025 - No director or officer adopted or terminated a Rule 10b5-1 trading plan during Q2 2025[316](index=316&type=chunk) [Exhibits](index=74&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including officer certifications and XBRL data files

Core Insights - Freeport-McMoRan Inc. (FCX) reported a significant increase in sales volumes for Q2 2025, with copper sales rising approximately 9% year-over-year to 1,016 million pounds, gold sales increasing by around 45% to 522,000 ounces, and molybdenum sales up about 4.8% to 22 million pounds [1][7] Sales Volume Outlook - The company has provided a cautious outlook for Q3 2025, expecting copper sales volumes to decline by 4% year-over-year to 990 million pounds, with gold and molybdenum sales also projected to decrease to 350,000 ounces and 18 million pounds, respectively [2][7] Pricing and Margin Considerations - Sales volume growth is essential for FCX to capitalize on higher copper and gold prices, maintain margin expansion, and meet its 2025 targets, despite the gains in realized prices [3][7] Peer Comparison - Among peers, Southern Copper Corporation (SCCO) experienced a 3% decline in copper sales volumes in Q2, while BHP Group Limited reported a 14% year-over-year increase in total copper sales for fiscal 2025 [4][5] Stock Performance and Valuation - FCX shares have increased by 4.7% year-to-date, contrasting with a 1.1% decline in the Zacks Mining - Non Ferrous industry [6] - The stock is currently trading at a forward 12-month earnings multiple of 18.9, slightly above the industry average of 18.69, and holds a Value Score of A [9] Earnings Estimates - The Zacks Consensus Estimate indicates a year-over-year earnings rise of 20.3% for 2025 and 31.9% for 2026, with EPS estimates trending higher over the past 60 days [8]

Company Overview - Freeport-McMoRan Inc. is engaged in mineral exploration and development, mining and milling of copper, gold, molybdenum, and silver, as well as smelting and refining of copper concentrates [11] - The company operates primarily through its subsidiaries, including PT Freeport Indonesia, Freeport Minerals Corporation, and Atlantic Copper [11] - PT Freeport Indonesia's principal asset is the Grasberg mine in Papua, Indonesia, which contains the world's largest copper and gold reserves [11] Investment Ratings - Freeport-McMoRan has a Zacks Rank of 3 (Hold) and a VGM Score of A, indicating a solid position in the market [12] - The company is considered a top pick for growth investors, with a Growth Style Score of B, forecasting year-over-year earnings growth of 18.9% for the current fiscal year [12] Earnings Estimates - In the last 60 days, six analysts revised their earnings estimates upwards, with the Zacks Consensus Estimate increasing by $0.11 to $1.76 per share [12] - Freeport-McMoRan has an average earnings surprise of +10.4%, suggesting a strong performance relative to expectations [12] Conclusion - With a solid Zacks Rank and top-tier Growth and VGM Style Scores, Freeport-McMoRan should be on investors' short list for potential investment opportunities [13]