From other sites
at CNBC.com (Nov 12, 2014)
at Zacks.com (Nov 5, 2014)
Freeport-McMoRan Inc. (FCX): New Analyst Report from Zacks Equity Research - Zacks Equity Research Reportat Zacks.com (Nov 5, 2014)
at Zacks.com (Nov 4, 2014)
at Zacks.com (Nov 4, 2014)
at CNBC.com (Oct 31, 2014)
at CNBC.com (Oct 28, 2014)
at CNBC.com (Oct 28, 2014)
at Zacks.com (Oct 28, 2014)
at CNBC.com (Oct 27, 2014)
How Does Freeport-McMoRan Use Collars To Hedge Commodity Price Exposure?
- Freeport-McMoRan is using collars built from put options to hedge their exposure to falling prices.
- The current prices of oil are nearing the bottom of the collar.
- The collars are in shape to pay off dramatically for the company this quarter.
- The latest presentation showed the potential for some significant gains.
- Options traders may know this strategy by the name “Bear Put Spread”.
Freeport-McMoRan: Bullish View Maintained For The Long Term
- Freeport-McMoRan's recent decline has been due to lower oil prices and the stock remains attractive for the long-term.
- The company has $1.5 billion from asset disposal proceeds to repay debt and has also issued bonds worth $3 billion to extend the debt maturity profile.
- Oil prices are likely to move higher over the next few quarters and this should help Freeport-McMoRan generate stronger cash flow.
- At an attractive EV/EBITDA valuation of 5.5 Freeport-McMoRan offers a dividend yield of 4.4%.
Freeport McMoRan - 32% Drop In Profits As Copper And Oil Prices Spiral Downward
- Freeport McMoRan’s third quarter results showcased a decline in the company’s revenues as its average selling prices for copper, gold and oil and gas declined.
- North American copper shipments noted declines due to the lower grade ore from the Candelaria and Cerro Verde mines.
- The company aims on reducing its debt to $12 billion by the end of 2016. Debt stood at $18 billion when the company announced its third quarter results.
- Copper futures continue to note declines and oil process remain volatile as the IEA slashed demand forecasts for oil in 2014 and 2015.
- Freeport shares trade at 13.26 times their earnings and offer a 4.50% dividend yield to investors.
Freeport-McMoRan Offers More Potential Than Risk
- FCX has strong cash operating margins to help the company survive hard periods.
- The company has been using its cash to reduce debt.
- I’m coming around to management’s vision on debt and equity.
- I believe that dollar cost averaging into the company is a very solid strategy.
- The pricing pressure in the copper as well as the oil and gas segment will affect the company in the short term.
- Copper and crude prices might not make a recovery in the short term.
- The long-term prospects of the company remain good, as the assets in both segments are extremely attractive.
Why Freeport-McMoRan Is A Great Buying Opportunity
- Now is a good opportunity for long-term investment in FCX's stock at a very cheap price.
- FCX is an excellent combination of compelling value and a strong growth high-yielding dividend stock.
- FCX has shown significant earnings per share surprise in each one of the last five quarters, and according to its historical valuation multiples, the stock is extremely undervalued.
Freeport-McMoRan - Broken Stock Or Broken Company?
- When a stock is getting beaten up by investors, one might assume the company is in trouble.
- Sometimes the stories told by a company's stock and a company's bonds are quite different.
- Freeport-McMoRan looks like a case of a broken stock, rather than a broken company.
- Freeport-McMoRan reports Q314 earnings and disruptions in Grasberg mining.
- Investors should wait for a further dip to buy the stock.
- The original investment thesis anticipated that further Grasberg issues and commodity prices would impact the stocks.
Update: Freeport-McMoRan Copper & Gold, Inc. Q3 2014 Earnings
- Quarter 3 earnings per share of $.64 beat analyst estimates by $.03.
- Revenues beat analyst estimates by an immaterial amount and were down 8% year over year.
- Weakness in revenue reflects weaker average selling prices in copper, gold, and oil.
- The company is struggling with labor relations after mishandling the deaths of four employers.
- Reduction in debt was anticipated, the strike was not.
- FCX takes a long-term view on high quality assets and is one of the most disciplined capital allocators in the industry.
- The company faces some near-term challenges in the form of commodity prices and geopolitical risks.
- Despite these near-term challenges, Freeport remains a company with many interesting growth projects.
Freeport-McMoRan: Does Dilution Defeat Dividend Reinvestment?
- I’m a bull for the company’s operations, but I don’t like the financing.
- The earnings payout ratio has gone over 100%, while share volume increases are diluting ownership positions.
- The increase in net interest expense does merit the attention of management, but it shouldn’t be prioritized over repurchasing shares to prevent dilution.
Freeport-McMoRan Inc. May Be Better Than Gold, But Not Under Modern Portfolio Theory
- There is correlation between FCX and GLD.
- Using GLD, CPER, and DBO creates a much better connection, though.
- Unlike GLD, FCX has a strong correlation to the S&P 500.
Here's The Best Way To Invest In Gold, And It's Not What Investors Might Expect
- Gold has suffered a significant decline over the past several months, due to the strengthening U.S. dollar.
- For investors expecting a rebound, buying a mining stock like Freeport McMoRan is a better way to play gold than buying the metal itself or a gold fund.
- That's because Freeport McMoRan offers all the necessary exposure to gold, plus a high dividend yield, and a booming oil and gas business.
Freeport-McMoRan: Implications Of The Candelaria/Ojos Del Salado Sale
- Freeport-McMoRan sells Candelaria/Ojos del Salado to Lunding Mining for $1.8 billion plus $0.2 billion of contingent consideration.
- The proceeds from the deal will go towards debt reduction.
- Current Freeport-McMoRan's strategy leads to a simpler company with great core assets.
Will Freeport-McMoRan Ever Get The Grasberg Mine Straightened Out?
- Freeport-McMoRan continues to struggle with operations at the large Grasberg mine in Indonesia.
- The company faces a high risk that copper finally rolls over and heads below $3/lb.
- The stock is increasingly difficult to own in a anti-commodity investment cycle.
Update: Freeport-McMoRan Announces Dividend - My Thesis Impacted
- Freeport-McMoran Copper and Gold has just announced that it will be paying a quarterly cash dividend of $0.3125 to its common stock shareholders.
- When I last opined on FCX, I highlighted the strengths of the company's growing production portfolio. I further pointed out that I thought the dividend was safe into 2014.
- The dividend being maintained is bullish as the company continues to remain profitable despite the downtick in commodities; my bull thesis was early but has been strengthened by the news.
Freeport-McMoRan Is Positioning Itself To Create Value In The Long-Term
- Freeport-McMoRan shares have fallen sharply this year amid concerns over debt and lower-than-expected earnings in the recent quarter.
- Copper prices have limited upside in the mid-term due to supply glut.
- Copper market could become fundamentally balanced in the long-term due to three factors.
- Freeport-McMoRan is positioning itself to capitalize when the copper market becomes fundamentally balanced.
Mon, Feb. 24, 9:15 AM
- In a potential victory for Freeport McMoRan (FCX) and Newmont Mining (NEM), Indonesia says it will ease the controversial tax on mineral concentrate exports for firms that build smelters in the country, in an apparent partial rollback of new rules that have caused the country's mining industry to grind to a halt.
- FCX is expected to resume exports of copper concentrate in the "near future," Indonesia's industry minister says; the company also confirms that it will build a copper smelter in the country.
Thu, Feb. 20, 8:58 AM
- Freeport McMoRan (FCX) says it is not among six companies that gained approval to export processed minerals and refined metals out of Indonesia.
- FCX, which operates the giant Grasberg mine in Papua, Indonesia, and Newmont Mining (NEM) have been in talks with the Indonesian government after a progressive export tax of up to 60% was introduced early last month.
- FCX -0.9% premarket.
Wed, Feb. 12, 9:59 AM
- Traders are lining up bets that Augusta Resource (AZC +2.3%) will win a higher offer than HudBay's (HBM +3.2%) recent unsolicited bid of C$2.96/share - ~C$540M including net debt -
- AZC’s Rosemont copper project in Arizona is large enough to attract other producers including OZ Minerals (OZMLF) and Teck Resources (TCK), Laurentian Bank of Canada says, estimates the company’s value is at least C$3.89/share based on similar deals.
- Freeport McMoRan (FCX) is another possible suitor with the financial strength to outbid HBM, according to National Bank Financial.
- “HudBay’s offer has little chance of success at its current valuation,” says a Toronto Dominion analyst.
Fri, Jan. 24, 4:43 PM
- Indonesia's metal ore and concentrate exports have ground to a halt, a trade ministry official tells Reuters, with a ban on ore shipments and an export tax introduced less than two weeks ago hurting the mining industry.
- Indonesia introduced an ore export ban on Jan. 12, although last-minute amendments eased the impact of the export ban on copper miners Freeport McMoRan (FCX) and Newmont Mining (NEM), which are now subject to a progressive export tax on concentrates.
- Freeport Indonesia has yet to resume exports since the export tax was introduced.
Wed, Jan. 22, 11:44 AM
- Freeport McMoRan (FCX -1.6%) CEO Richard Adkerson tells analysts in its Q4 earnings call that it will "defend its rights" in Indonesia against a new export tax he says contravenes its agreement with the government, but the company feels "positive" about getting the matter resolved.
- FCX says it will defer production of ~40M lbs. of copper and 80K oz. of gold per month until the issue was resolved.
- Adkerson says FCX is seeing "relatively improved" near-term fundamentals for copper globally and that long-term fundamentals for copper are strong.
- Sees copper sales steadily rising during through 2016, from 4.1B in 2013 to 4.4B in 2014, 5B in 2015 and 5.7B in 2016; sees gold sales growing in 2014 to 1.7M oz. from 1.2M oz. in 2013.
- Says Gulf of Mexico asset sale postponed indefinitely but working on other asset sales and a potential MLP opportunity.
Wed, Jan. 22, 8:49 AM
- Freeport McMoRan (FCX) -1.7% premarket as Q4 earnings drop to $0.68/share from $0.78/share a year ago and below analyst estimates, as copper and gold prices dropped.
- Revenue rose to $5.89B from $4.51B, boosted by the company's recent oil and gas acquisitions.
- Q4 consolidated copper sales of 1.14B lbs. were higher than year-ago Q4 sales of 972M lbs., reflecting improved volumes throughout FCX's global mining operations.
- Q4 consolidated gold sales of 512K oz. were more than double year-ago sales of 254K oz., reflecting higher ore grades and improved operating performance in Indonesia.
- Q4 consolidated average unit net cash costs for FCX's copper mines of $1.16/lb. were significantly lower than unit net cash costs of $1.54/lb. in Q4 2012, primarily reflecting higher copper and gold sales volumes and ongoing cost control efforts.
Wed, Jan. 22, 8:01 AM| Comment!
Wed, Jan. 22, 12:05 AM
Tue, Jan. 21, 5:30 PM
Tue, Jan. 21, 12:21 PM
- Mining stocks are having a rough ride today as the pace of growth slows in China's GDP and industrial production, and Goldman Sachs comes out bearish on copper and iron ore prices.
- Proclaiming "the sunset of the Iron Age starts in 2014," Goldman believes the steel intensity of the Chinese economy will be on a downward trend from 2014 onwards following a decade where steel production growth outpaced GDP growth.
- Some indicators already point to lower rates of steel production growth, the firm says; Chinese steel-making capacity is near its peak, and a greater focus on environmental regulations is driving the closure of an increasing number of blast furnaces.
- Goldman expects Iron ore to fall to $108/ton in 2014 and $80/ton in 2015.
- CLF -6.1%, RIO -3.2%, VALE -4%, FCX -1.9%, BHP -1.6%.
Fri, Jan. 17, 3:18 PM
- Freeport McMoRan (FCX -1.5%) may face as much as $5B in extra taxes over the next three years if it fails to convince Indonesia's government to back down from a new export tax.
- FCX and Newmont Mining (NEM) together account for virtually all copper mining in Indonesia and are exempt from export taxes under current contracts, but new rules hike to 25% a tax for copper concentrate exports and levy the tax on FCX and NEM for the first time; the tax would rise to 60% by the end of 2016 before exports of concentrate are banned from 2017.
- The two miners are expected to meet finance ministry officials today.
- Cowen is out cautious on FCX shares, citing the issues surrounding the Indonesia export license.
Tue, Jan. 14, 12:36 PM
- It's time to take profits in Freeport McMoRan (FCX +0.2%) after a strong six-month run, FBR Capital says in downgrading shares to Market Perform from Outperform.
- While investors are excited at the possibility of an MLP of FCX's California oil and gas assets, the firm believes proceeds ($5.3B-$6B) may not be enough to support expanded valuation and giving up diversified exposure, which was one of the rationales for the acquisition of the assets.
- FBR sees Southern Copper (SCCO +2.1%) as a better bet now; it thinks most of the production growth/dividend cut risk now has been priced in, valuation has become more attractive, and SCCO should restart work on its troubled Tia Maria project by March.
Mon, Jan. 13, 9:44 AM
- Indonesia clarifies its mineral export ban, closing the door on the export of ores but allowing the export of six forms of concentrate that will permit some of the country's biggest foreign miners to continue operations.
- The finance minister says miners can pay special taxes to be able to export copper, iron ore, manganese, lead, zinc and ilmenite for the next three years as long as they meet minimum purity levels, meaning Freeport McMoRan (FCX -0.7%) and Newmont Mining (NEM -0.6%) can continue to export from their huge copper mines in the country but with a 20% tax.
Thu, Jan. 9, 3:55 PM
- Rio Tinto (RIO -2.2%) is named a Top Pick in European Metals and Mining by Bernstein analyst Paul Gait, who cites Rio's top-quality asset base and notes that Rio's cash generation continues to surprise the market.
- "Top line surprises combined with Rio throttling back on capital expenditure will drive a gap between cash flow generation and outflows," the firm says, adding there's "no reason why the resultant de-gearing of Rio’s balance sheet should not see its dividend double."
- The kind words aren't helping RIO shares, as the big global miners are broadly lower today: BHP -1.2%, VALE -2.8%, CLF -6.5%, FCX -1.3%.
Dec. 27, 2013, 8:10 AM
- Beginning on January 12, Indonesia will no longer allow the export of raw minerals. "There should be refining or smelting," the country's Energy and Mineral Resources Minister says.
- The new law is intended to "boost the value of metal shipments by promoting domestic processing," Bloomberg notes.
- Both Freeport-McMoRan (FCX) and Newmont Mining (NEM) may be affected and are in consultation with Indonesian authorities to determine if they will be allowed to ship concentrate.
- For its part, NEM may look into additional smelting operations.
Dec. 23, 2013, 3:17 PM
- Freeport McMoRan (FCX) is restructuring its employment agreement with CEO Richard Adkerson, tying his compensation to the stock's performance.
- Adkerson will give up his salary, bonus, and rights to severance and change-of-control payments in exchange for restricted stock worth ~$36M; he will continue as CEO, president and vice chairman.
- FCX says the agreement is another step of progress in strengthening its corporate governance practices, with further modifications ahead in its executive compensation program.
FCX vs. ETF Alternatives
Other News & PR