FCX Slips Below 200-Day SMA: What Should Investors Do Now?

Core Viewpoint - Freeport-McMoRan Inc. (FCX) has experienced a decline in stock price, falling below the 200-day simple moving average, despite reporting increased revenues and profits due to higher copper and gold prices. The company's guidance indicates rising unit costs and lower expected sales volumes for copper and gold [1][7][28]. Stock Performance - FCX's stock has dropped 5.3% over the past month, outperforming the Zacks Mining - Non Ferrous industry, which declined by 8.6%, but underperforming the S&P 500's 1.2% drop. Competitors Southern Copper Corporation (SCCO) and BHP Group Limited (BHP) have seen losses of 8.3% and 5.5%, respectively [5]. Financial Performance - In Q3 2025, FCX reported operating cash flows of approximately $1.7 billion, with a strong liquidity position of $4.3 billion in cash and equivalents, and $3 billion available under its revolving credit facility [13]. The company ended the quarter with a net debt of $1.7 billion, below its target range of $3-$4 billion [14]. Production and Expansion Plans - FCX is focused on expanding its copper output, with significant projects underway, including a large-scale concentrator expansion at Cerro Verde in Peru, which is expected to add around 600 million pounds of copper annually [10]. The company is also evaluating expansion opportunities at El Abra in Chile and conducting pre-feasibility studies in Arizona [11]. Copper and Gold Prices - The average realized copper price for FCX increased nearly 9% year-over-year to $4.68 per pound in Q3 2025, contributing positively to its financial results [19]. However, copper prices have shown volatility, with fluctuations influenced by global economic conditions [17][18]. Cost and Sales Volume Challenges - FCX's average unit net cash cost per pound of copper rose to $1.40 in Q3 2025, a 24% increase from the previous quarter, driven by lower sales volumes [20]. The company anticipates further increases in unit costs and a significant decline in copper sales volumes for Q4 2025 due to operational suspensions at the Grasberg mine [21][23]. Earnings Estimates - Earnings estimates for FCX have been revised downward over the past 60 days, indicating a cautious outlook for the company [24]. Valuation - FCX is currently trading at a forward price/earnings ratio of 21.34X, which is a premium to the industry average of 20.3X, but at a discount to Southern Copper and a premium to BHP Group [25]. Investment Outlook - Despite the challenges posed by weaker sales volume outlook and higher expected unit costs, FCX's strong financial health and ongoing expansion projects suggest a potential for future growth. Holding the stock is recommended for current investors [28].