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Freeport-McMoRan (FCX)
NYSE:FCX
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Freeport-McMoRan
(NYSE:FCX)71Outperform
Positive Factors
Operational Improvements
Freeport's smelter repairs are progressing on track, which could lead to increased Free Cash Flow yield when export duties decrease.
Tariffs on Copper Imports
If tariffs on copper imports are implemented, it could lead to higher domestic prices, which Freeport-McMoRan could pass on to its customers, benefiting from the premium in COMEX prices over LME prices.
Negative Factors
New Indonesian Law
A new Indonesian law requires commodity exporters to keep 100% of foreign currency proceeds deposited in national banks for at least 12 months.
Freeport-McMoRan (FCX) vs. S&P 500 (SPY)
Market Cap
$54.15B
Dividend Yield1.62%
Average Volume (3M)15.66M
Price to Earnings (P/E)28.9
Beta (1Y)1.52
Revenue Growth10.71%
EPS Growth1.94%
CountryUS
Employees28,500
SectorBasic Materials
Sector Strength56
IndustryMining
Share Statistics
EPS (TTM)1.30
Shares Outstanding1,437,073,000
10 Day Avg. Volume16,468,468
30 Day Avg. Volume15,656,680
Financial Highlights & Ratios
PEG Ratio14.90
Price to Book (P/B)N/A
Price to Sales (P/S)2.13
Price to Cash Flow (P/CF)9.40
P/FCF Ratio9.30
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$48.92Price Target Upside32.43% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering13
Freeport-McMoRan Business Overview & Revenue Model
Company DescriptionFreeport-McMoRan Inc. (FCX) is a leading international mining company headquartered in Phoenix, Arizona. It is primarily engaged in the exploration, mining, and production of natural resources, with a strong focus on copper, gold, and molybdenum. The company operates large, long-lived, geographically diverse assets with significant proven and probable reserves of copper, gold, and molybdenum. Freeport-McMoRan's portfolio of assets includes the Grasberg minerals district in Indonesia, one of the world's largest copper and gold deposits, as well as significant mining operations in North America, South America, and the Democratic Republic of Congo.
How the Company Makes MoneyFreeport-McMoRan generates revenue primarily through the sale of copper, gold, and molybdenum, which are extracted from its mining operations. Copper is the largest contributor to the company's revenue, driven by its widespread use in electrical equipment, construction, and various industrial applications. Gold and molybdenum, valuable by-products of copper mining, also provide significant revenue streams. The company's earnings are influenced by commodity prices, which are determined by global supply and demand dynamics. Additionally, Freeport-McMoRan engages in strategic partnerships and joint ventures to optimize its operations and expand its resources, such as its collaboration with the Indonesian government for the Grasberg mine. The company's financial performance is also affected by operational efficiencies, cost management strategies, and investments in sustainable mining practices.
Freeport-McMoRan Financial Statement Overview
Summary
Freeport-McMoRan exhibits strong financial metrics with robust profitability, effective cost management, and solid growth. The company demonstrates impressive revenue and profit growth, backed by efficient operations, a stable balance sheet, and robust cash flow generation.Income Statement
Freeport-McMoRan demonstrates strong financial performance with a notable growth trajectory. The company achieved a revenue growth rate of 11.38% in 2024 and an impressive net profit margin of 37.03%, indicating robust profitability. Gross profit margin stands at 39.15%, reflecting effective cost management. The EBIT and EBITDA margins are also solid at 26.95% and 34.68% respectively, highlighting operational efficiency. Despite these strengths, the company should continue monitoring its growth pace to sustain long-term performance.89
Very Positive
Balance Sheet
The balance sheet of Freeport-McMoRan shows a stable leverage position with a debt-to-equity ratio of 0.51, indicating a manageable level of debt. The equity ratio is 32.05%, illustrating a strong equity base relative to total assets. Return on equity (ROE) is notably high at 53.63%, demonstrating excellent returns to shareholders. While the company maintains a solid financial position, careful management of liabilities and continued strengthening of the equity base will be crucial for future stability.75
Positive
Cash Flow
Freeport-McMoRan's cash flow statement reveals robust cash generation capabilities, with an operating cash flow to net income ratio of 0.76 and a significant free cash flow growth rate of 57.36% in 2024. The free cash flow to net income ratio is 0.76, highlighting efficient cash conversion. The strong cash flow underscores the company's ability to fund operations and growth initiatives. However, maintaining this momentum will be essential to support future capital expenditures and strategic investments.82
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 25.45B | 22.86B | 22.78B | 22.84B | 14.20B | Gross Profit |
| 7.66B | 7.16B | 7.69B | 8.81B | 2.54B | EBIT |
| 6.86B | 6.22B | 7.04B | 8.37B | 2.44B | EBITDA |
| 8.83B | 8.59B | 9.29B | 10.26B | 3.92B | Net Income Common Stockholders |
| 1.89B | 1.84B | 3.47B | 4.31B | 853.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 3.92B | 4.76B | 8.15B | 8.07B | 3.66B | Total Assets |
| 54.85B | 52.51B | 51.09B | 48.02B | 42.14B | Total Debt |
| 8.95B | 9.85B | 10.62B | 9.45B | 9.71B | Net Debt |
| 5.03B | 5.09B | 2.47B | 1.38B | 6.05B | Total Liabilities |
| 26.07B | 25.20B | 26.22B | 25.00B | 23.48B | Stockholders Equity |
| 17.58B | 16.69B | 15.55B | 13.98B | 10.17B |
| Cash Flow | Free Cash Flow | |||
| 2.35B | 455.00M | 1.67B | 5.60B | 1.06B | Operating Cash Flow |
| 7.16B | 5.28B | 5.14B | 7.71B | 3.02B | Investing Cash Flow |
| -5.03B | -4.96B | -3.44B | -1.96B | -1.26B | Financing Cash Flow |
| -3.28B | -2.65B | -1.62B | -1.34B | -128.00M |
Freeport-McMoRan Technical Analysis
Negative
36.94
Price Trends
38.00
Negative
41.22
Negative
43.90
Negative
Market Momentum
-0.39
Positive
47.01
Neutral
70.51
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FCX, the sentiment is Negative. The current price of 36.94 is below the 20-day moving average (MA) of 37.75, below the 50-day MA of 38.00, and below the 200-day MA of 43.90, indicating a bearish trend. The MACD of -0.39 indicates Positive momentum. The RSI at 47.01 is Neutral, neither overbought nor oversold. The STOCH value of 70.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FCX.
Freeport-McMoRan Risk Analysis
Freeport-McMoRan disclosed 30 risk factors in its most recent earnings report. Freeport-McMoRan reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Freeport-McMoRan Peers Comparison
Overall Rating
UnderperformOutperform
Sector (47)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $41.47B | 7.13 | 16.72% | 9.27% | -8.71% | -22.75% | |
74 Outperform | $125.09B | 11.32 | 26.13% | 5.70% | -3.15% | 54.08% | |
72 Outperform | $72.31B | 21.14 | 40.71% | 2.16% | 15.54% | 39.64% | |
71 Outperform | $54.15B | 28.92 | 10.92% | 1.62% | 10.71% | 1.94% | |
70 Outperform | $104.57B | 8.98 | 20.93% | 6.97% | -0.81% | 14.59% | |
66 Neutral | $49.41B | 15.35 | 11.13% | 2.28% | 58.27% | ― | |
47 Neutral | $2.64B | -4.00 | -31.55% | 3.33% | 2.93% | -29.90% |
* Basic Materials Sector Average
Performance Comparison
FCX
Freeport-McMoRan
36.94
-2.97
-7.44%
BHP
BHP Group
50.16
-3.38
-6.31%
NEM
Newmont Mining
43.87
9.42
27.34%
RIO
Rio Tinto
62.31
4.16
7.15%
SCCO
Southern Copper
90.96
8.63
10.48%
VALE
Vale SA
9.90
-1.93
-16.31%
Freeport-McMoRan Earnings Call Summary
Earnings Call Date: Jan 23, 2025 | % Change Since: -5.50% | Next Earnings Date: Apr 17, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted strong financial performance and operational achievements, particularly in copper production and innovative initiatives. However, challenges such as export approvals in Indonesia, increased capital expenditures, and geopolitical risks were also discussed. The sentiment was balanced with optimism about future growth opportunities and ongoing strategic initiatives.Highlights
Strong Financial Performance
FCX achieved $10 billion in EBITDA for 2024, a 14% increase over 2023, with operating cash flows of over $7 billion, a 35% improvement from the prior year.
Copper Sales and Market Position
Copper sales targets were met, and average copper prices were $4.21 per pound, with the company positioning itself strongly in the market for future demand.
Innovative Leach Initiative
The leach initiative achieved a 50% increase in copper production in 2024 at a very low cost, with targets to produce 300 million to 400 million pounds by 2026 and ultimately 800 million pounds by 2030.
U.S. Production Increase
Production in the U.S. is expected to increase by 8% in 2025, with opportunities for further increases in 2026 and 2027.
Progress on Indonesian Smelter
Despite a fire incident, the smelter recovery activities are in progress, with production expected to recommence by mid-2025.
Lowlights
Indonesian Export Challenges
Ongoing discussions are required with the Indonesian government to allow exports during smelter repairs, with potential impacts if approvals are delayed.
Potential Legislative Uncertainty in the U.S.
Uncertainty around U.S. legislation regarding copper as a critical mineral, which could impact potential tax credit benefits.
Increased Capital Expenditure
Capital expenditures are projected to increase to approximately $4.4 billion per year in 2025 and 2026, with discretionary CapEx also rising.
Geopolitical Risks
Ongoing geopolitical risks and negotiations in Indonesia, including challenges related to license extensions beyond 2041.
Company Guidance
During the Freeport-McMoRan Q4 2024 earnings call, the executives provided guidance encompassing several key metrics and strategic focuses. The company reported achieving $10 billion in EBITDA for 2024, a 14% increase over 2023, with operating cash flows improving by 35% to over $7 billion. Copper sales were highlighted, with an average realization of $4.21 per pound and gold slightly above $2,400 per ounce. For 2025, the company aims to improve execution across operations, targeting a run rate of 300 million pounds of additional copper by year-end, and plans to scale this to 800 million pounds annually by 2030. Freeport also intends to leverage its strong operational execution, with projected capital expenditures of approximately $4.4 billion per year in 2025 and 2026, including investments in growth projects such as the Kucing Liar development. The company emphasized maintaining a strong balance sheet and outlined potential impacts from geopolitical and legislative factors, such as potential U.S. tax credits on copper production.Freeport-McMoRan Corporate Events
Business Operations and StrategyFinancial Disclosures
Freeport-McMoRan Reports Strong Q4 2024 Financial Performance
Positive
Jan 23, 2025
In the fourth quarter of 2024, Freeport-McMoRan reported a net income attributable to common stock of $274 million, alongside an adjusted net income of $450 million. The company achieved solid operating performance with sales volumes of copper and gold exceeding guidance, and unit net cash costs falling below expectations. Key developments include the start-up of the Indonesia Precious Metals Refinery and plans for a smelter start-up by mid-2025, indicating a strong financial position and favorable market outlook. The company also repaid $0.7 billion in maturing senior notes and ended the year with consolidated debt of $8.9 billion.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.