This Copper Stock Is Worth Mining. The Metal's Boom Is On. - Barron'sSkip to Main ContentThis copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com.# This Copper Stock Is Worth Mining. The Metal's Boom Is On.## Copper has pulled back on Iran concerns, creating a buying opportunity f ...

Freeport-McMoRan Inc. (NYSE:FCX) ranks among the best mineral stocks to invest in. On February 20, Freedom Capital Markets raised Freeport-McMoRan Inc. (NYSE:FCX) from Hold to Buy and boosted its price target to $76 from $47. The firm emphasized the company's standing as a key copper producer, accounting for roughly 9% of global supply. According to Freedom Capital, the upgrade indicates leveraged exposure to the copper rebound amid restricted supply. The firm also underlined ambiguity around the Grasbe ...

Core Viewpoint - Freeport-McMoRan Inc. is experiencing a volatile stock performance despite being a leading copper miner, with recent gains being largely reversed, indicating potential near-term valuation concerns and geopolitical complexities [2][3]. Company Overview - Freeport-McMoRan is one of the world's leading copper miners, benefiting from a bullish sentiment in the basic materials sector, particularly mining stocks [2]. - The Grasberg mine in Indonesia is a significant asset for Freeport, being one of the largest copper and gold mines globally, which is central to the company's long-term growth narrative [4]. Recent Developments - On February 18, Freeport restructured its relationship with the Indonesian government, trading a majority stake in the Grasberg operation for operational continuity and a long-term contract, securing rights to operate through at least 2041 [5][6]. - This restructuring has resulted in Freeport holding a minority economic interest in the Grasberg mine, which reduces its earnings leverage compared to its previous majority position [8]. Market Dynamics - Rising copper demand driven by electric vehicles, data centers, and electrification supports the long-term bullish outlook for Freeport's stock [7]. - Following an 80% rally in four months, technical indicators suggest that Freeport's stock may experience a pullback to the $55–$57 range before potentially moving higher again [7].

Core Viewpoint - Freeport-McMoRan Inc. (FCX) shares have increased by 39% over the past three months, driven by rising copper prices due to global supply concerns, tariff uncertainties, and strong demand [1] Price Performance - FCX has outperformed the S&P 500's increase of 0.1% but underperformed the Zacks Mining - Non Ferrous industry's rise of 46.8% during the same period [1] - Peers Southern Copper Corporation (SCCO) and BHP Group Limited (BHP) have seen their shares rise by 36.5% and 30%, respectively [1] Technical Indicators - FCX has been trading above the 50-day and 200-day simple moving averages (SMA) since late November 2025, indicating a bullish trend following a golden crossover on July 8, 2025 [5] Growth Initiatives - Freeport is focusing on organic growth opportunities to enhance long-term production and cash flow [7] - Significant expansions at Cerro Verde in Peru are expected to add approximately 600 million pounds of copper and 15 million pounds of molybdenum annually [10] - Pre-feasibility studies at Safford/Lone Star operations in Arizona are set for completion in 2026, assessing a sulfide expansion opportunity [11] - A new greenfield smelter in Eastern Java is expected to ramp up operations, with initial copper anode production achieved in July 2025 [12] Financial Health - FCX generated operating cash flows of around $5.6 billion in 2025, with $3.8 billion in cash and cash equivalents at year-end [13] - The company has a net debt of $2.3 billion, below its targeted range, and a long-term debt-to-capitalization ratio of approximately 22.5% [14] Dividend Policy - FCX offers a dividend yield of roughly 0.5% with a payout ratio of 17%, indicating a sustainable dividend policy [15] Copper Market Dynamics - Copper prices remained favorable, averaging around $5.33 per pound in Q4 2025, supported by strong demand from China and the U.S. [16][18] - Supply concerns due to rising demand for electric vehicles and infrastructure are contributing to price stability, with current prices near $6 per pound [18] Cost Pressures - FCX's average unit net cash cost per pound of copper increased to $2.22 in Q4 2025, a 59% rise from the previous quarter [19] - The company anticipates further cost increases in Q1 2026, projecting unit net cash costs to rise to $2.60 per pound [20] Sales Volume Challenges - Copper sales volumes fell approximately 29% year-over-year in Q4 2025, primarily due to operational suspensions at the Grasberg Block Cave mine [21] - FCX expects a further decline in copper sales volumes for Q1 2026, projecting 640 million pounds, a 10% sequential and 27% year-over-year decrease [22] Earnings Outlook - Earnings estimates for FCX have been revised upward over the past 60 days for 2026 and 2027 [24] Valuation - FCX is currently trading at a forward price/earnings ratio of 24.87X, which is a 4.6% discount to the industry average [25] Conclusion - Freeport is positioned for growth through expansion initiatives and strong financial health, but faces challenges from lower sales volumes and rising costs [27]

Core Insights - Freeport-McMoRan Inc. (FCX) experienced a significant increase in its average unit net cash cost per pound of copper, rising to $2.22 in Q4 2025 from $1.40 in the previous quarter, representing a 59% increase and a 34% year-over-year rise [1][7] Sales Volumes - Copper sales volumes for Freeport declined approximately 29% year over year in Q4 2025, totaling 709 million pounds, down from 977 million pounds in the prior quarter, primarily due to the temporary suspension of operations at the Grasberg Block Cave mine in Indonesia following a mud rush incident in September 2025 [2][7] Cost Outlook - The company anticipates higher costs in Q1 2026, projecting unit net cash costs to rise to $2.60 per pound, with a full-year average expected to be around $1.75. Lower anticipated sales volumes are likely to negatively impact costs during the quarter, which may affect the company's margins [3][7] Peer Comparison - Southern Copper Corporation (SCCO) reported lower unit costs in Q4, with an operating cash cost per pound of copper at 52 cents, a 46% decrease from 96 cents in the prior-year quarter. SCCO's costs also fell approximately 34% year over year in 2025 [4] - BHP Group Limited (BHP) reported lower unit costs across its operations, with expectations for Escondida's unit cost to be between $1.20 and $1.50 per pound for fiscal 2026, and Copper South Australia's unit cost projected between $1 and $1.50 per pound [5] Stock Performance - Freeport's shares have increased by 41.3% over the past six months, compared to a 73.5% rise in the Zacks Mining - Non Ferrous industry [6] Valuation Metrics - FCX is currently trading at a forward 12-month earnings multiple of 24.88, which is a 4.3% discount to the industry average of 26X, and it carries a Value Score of B [8] Earnings Estimates - The Zacks Consensus Estimate for FCX's earnings in 2026 and 2027 indicates a year-over-year increase of 44.1% and 22.3%, respectively, with EPS estimates trending higher over the past 30 days [9]

Core Viewpoint - Freeport McMoRan's stock experienced a significant decline due to a broader downturn in commodities linked to escalating military actions in the Middle East, particularly involving the U.S. and Iran [1]. Company Impact - Freeport McMoRan's shares fell sharply on Tuesday, reflecting a negative sentiment in the market for metals and mining companies [1]. Industry Context - The decline in commodity prices is part of a risk-off trading environment, influenced by geopolitical tensions in the Middle East [1].

Group 1 - Intensifying conflict in the Middle East is causing declines in stocks, bonds, and safe-haven assets, including gold, which has dropped sharply after initial strikes on Iran [1][2] - The SPDR Gold Trust (GLD) has seen a recent decline of 4%, with the spot price of gold falling to approximately $5,130 per ounce from a high of over $5,400 [2] - Mining stocks, particularly Newmont (NEM), have been significantly affected, with Newmont's shares falling more than 8%, while Barrick (B) and Freeport-McMoRan (FCX) also experienced declines [2][7] Group 2 - The recent sell-off in mining stocks aligns with the typical correlation between metal prices and mining equities, yet the decline in gold prices is puzzling given its status as a haven asset during high tensions [3][4] - Commodity experts indicate that price gains in gold due to conflict are often temporary, as seen in historical conflicts, and that gold's performance is inversely related to the strengthening U.S. dollar [3][5] - The U.S. dollar index has risen nearly 1%, reaching its highest level since mid-January, which is contributing to the downward pressure on gold prices [6][7]

Core Viewpoint - Metals and mining stocks are experiencing significant declines due to falling commodity prices [1] Group 1: Industry Impact - The overall metals and mining sector is facing pressure as commodity prices drop [1]

Core Viewpoint - Oppenheimer analysts highlight bullish momentum across multiple sectors as March unfolds, indicating potential trading opportunities, especially when the S&P 500 index remains above its 200-day moving average [1][3] Group 1: Market Performance - Historical data shows that March market returns typically outperform February, with the S&P 500 index averaging a 1.2% increase since 1950 under the current technical conditions, achieving a 66% probability of rising [3] - The S&P 500 index is currently above the support level of 6520 points, maintaining an upward trend, with the past four months of consolidation alleviating previous overbought pressures [3] Group 2: Sector Focus - Analysts suggest shifting focus from mega-cap stocks to broader market opportunities, emphasizing the importance of embracing market breadth rather than fixating on market capitalization strength [3] - Despite the "seven giants" dragging down the S&P 500 since last October, momentum factors remain resilient, with a strong emphasis on avoiding weak sectors while capturing strong stocks [3] Group 3: Technology Sector Insights - Within the technology sector, a clear divergence is observed between software stocks and equal-weighted tech stocks, with software stocks negatively impacting overall tech performance since a downgrade in mid-January [3] - Excluding software stocks, the overall momentum score for the tech sector improved significantly from -4% to +6% [3] Group 4: Recommended Stocks - Oppenheimer recommends "buy" ratings for several stocks in the technology sector, including Apple (AAPL.US), TE Connectivity (TEL.US), Jabil (JBL.US), and MongoDB (MDB.US) [4] - In the biotech sector, Oppenheimer identifies a potential turning point after a "lost decade," with biotech equal-weight ETFs recovering their four-year moving average for the first time since June 2021 [4] - The metals and mining sector has completed a decade-long bottoming and breakout pattern, with recommended stocks including Alcoa (AA.US), Freeport-McMoRan (FCX.US), MP Materials (MP.US), and Century Aluminum (CENX.US) [4] Group 5: Energy Sector Analysis - The energy sector has shown notable performance, with momentum scores rising from 0% to +4%, marking one of the largest monthly increases [4] - The SPDR ETF for the energy sector has broken through a technical resistance level that has persisted since 2014, indicating a long-term bottom is being established [4] - Recommended energy stocks include Baker Hughes (BKR.US), TechnipFMC (FTI.US), Targa Resources (TRGP.US), and Valero Energy (VLO.US) [5]

Group 1: Company Overview - Freeport-McMoRan Inc. (NYSE:FCX) is a leading mining company that produces copper, a critical component for electric vehicle (EV) batteries and electric infrastructure, along with gold and molybdenum [5]. Group 2: Recent Developments - On February 18, Freeport-McMoRan announced a Memorandum of Understanding (MOU) with the Indonesian government to extend PT Freeport Indonesia's operational rights in the Grasberg mining zone, ensuring continued operations and expanding exploration [3]. - The agreement allows FCX to maintain a 48.76% ownership through 2041, with a 12% stake transferring to government interests at no cost in 2041, contingent on reimbursement of post-2041 investment costs [4]. Group 3: Market Outlook - BofA Securities raised its price target for FCX to $81 from $68 while maintaining a Buy rating, following a revision of its 2026 metal price projections [2][8].