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Freeport McMoRan Provides Big Gains

|Includes: Freeport-McMoRan Inc. (FCX)
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September 21, 2010
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Forecast Model Success Story

Freeport McMoRan Provides Big Gains

 Freeport-McMoRan (NYSE:FCX) is engaged in mineral exploration and development, mining and milling of copper, gold, and silver in Indonesia, and the smelting and refining of copper concentrates in Spain and Indonesia. They are the world's lowest-cost copper producer and one of the world's largest producers of copper and gold. FCX's operations are conducted through its subsidiaries, P.T. Freeport Indonesia (PT-FI), P.T. IRJA Eastern Minerals Corporation (Eastern Mining) and through Atlantic Copper, S.A. (Atlantic).

  Since selected for inclusion in out Forecast 22 Market Neutral Strategy Portfolio, Freeport-McMoRan has returned almost 30% in two months.  It has been a Basic Industries Sector powerhouse along with its sister pick, Domtar Paper (NYSE:UFS)--which is up smartly as well.  Freeport-McMoRan remains ranked a buy, but the valuation does appear to be a bit overdone.  Our models find the stock has good forecasts, but is pushing into an overvalued status.  Critical for Freeport-McMoRan's prospects will be the price of Copper.  Should the world-wide recovery falter and commodities prices decline, the company may prove unable to sustain its recent performance-- and profits.

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Market Indices Data
  Latest Change YTD
Dow Jones
10,822.30 68.64 3.78%
NASDAQ Composite
2,364.03 8.20 4.18%
Russell 2000
668.36 -1.62 5.41%
S&P 500
1,147.45 4.74 2.90%

 

ValuEngine Market Overview
Summary of VE Stock Universe
Stocks Undervalued
62.54%
Stocks Overvalued
37.46%
Stocks Undervalued by 20%
31.41%
Stocks Overvalued by 20%
12.83%

 

ValuEngine Sector Overview
Sector Change MTD YTD Valuation Last 12-MReturn P/E Ratio
Basic Industries 0.99% 5.00% 20.32% 1.03% overvalued 29.66% 23.16
Energy 1.98% 5.02% -0.22% 1.00% overvalued 22.09% 24.55
Public Utilities 1.51% 2.11% -2.56% 2.49% undervalued 9.79% 18.63
Transportation 1.27% 5.80% 9.76% 2.66% undervalued 10.13% 18.66
Finance 1.51% 4.34% 10.11% 6.67% undervalued 1.00% 17.90
Consumer Non-Durables 1.66% 4.33% 5.47% 7.13% undervalued 16.27% 16.58
Consumer Services 1.94% 6.72% 7.86% 8.57% undervalued 9.52% 20.68
Capital Goods 1.95% 4.89% 13.60% 9.04% undervalued 6.75% 20.13
Technology 1.89% 7.75% 12.80% 11.67% undervalued 16.52% 23.79
Health Care 1.78% 6.37% 18.01% 13.56% undervalued -0.34% 21.20
Consumer Durables 2.29% 6.20% 10.39% 13.74% undervalued 18.18% 17.12

 

 
 
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Disclosure: No positions