Unveiling Market Insights – A Look at FCX Stock

Now trading at a price of $38.47, Freeport-McMoRan has moved -2.0% so far today.

Freeport-McMoRan returned gains of 17.0% last year, with its stock price reaching a high of $46.73 and a low of $26.03. Over the same period, the stock outperformed the S&P 500 index by 11.0%. More recently, the company's 50-day average price was $40.75. Freeport-McMoRan Inc. engages in the mining of mineral properties in North America, South America, and Indonesia. Based in Phoenix, AZ, the large-cap Basic Materials company has 25,600 full time employees. Freeport-McMoRan has offered a 1.5% dividend yield over the last 12 months.

The Business Runs With Low Leverage Levels:

2018-02-20 2019-02-15 2020-02-14 2021-02-16 2022-02-15 2023-02-15
Revenue (MM) $16,403 $18,628 $14,402 $14,198 $22,845 $22,780
Operating Margins 23% 25% 5% 15% 37% 31%
Net Margins 11.0% 14.0% -2.0% 4.0% 19.0% 15.0%
Net Income (MM) $1,817 $2,602 -$239 $599 $4,306 $3,468
Net Interest Expense (MM) -$801 -$945 -$620 -$598 -$602 -$560
Depreciation & Amort. (MM) -$1,714 -$1,754 -$1,412 -$1,528 -$1,998 -$2,019
Earnings Per Share $1.25 $1.78 -$0.16 $0.41 $2.91 $2.39
EPS Growth n/a 42.4% -108.99% 356.25% 609.76% -17.87%
Diluted Shares (MM) 1,454 1,458 1,451 1,461 1,482 1,451
Free Cash Flow (MM) $6,076 $5,834 $2,073 $3,048 $8,200 $6,771
Capital Expenditures (MM) -$1,410 -$1,971 -$591 -$31 -$485 -$1,632
Net Current Assets (MM) -$15,380 -$13,604 -$15,446 -$14,173 -$10,173 -$10,609
Long Term Debt (MM) $11,815 $11,124 $9,821 $9,677 $9,078 $9,583
Net Debt / EBITDA 1.56 1.08 3.56 1.66 0.13 0.27

Freeport-McMoRan has an excellent current ratio, low leverage, and positive EPS growth. Furthermore, Freeport-McMoRan has weak revenue growth and a flat capital expenditure trend, average net margins with a positive growth rate, and irregular cash flows.

The Market May Be Overvaluing Freeport-McMoRan's Earnings and Assets:

Freeport-McMoRan has a trailing twelve month P/E ratio of 27.7, compared to an average of 10.03 for the Basic Materials sector. Based on its EPS guidance of $1.98, the company has a forward P/E ratio of 20.6. The company doesn't issue forward earnings guidance, and the compound average growth rate of its last 6 years of reported EPS is 2.7%. On this basis, the company's PEG ratio is 10.12, which suggests that it is overpriced. Furthermore, Freeport-McMoRan is likely overvalued compared to the book value of its equity, since its P/B ratio of 3.41 is higher than the sector average of 2.08. The company's shares are currently trading 26.7% above their Graham number.

Freeport-McMoRan Has an Average Rating of Buy:

The 20 analysts following Freeport-McMoRan have set target prices ranging from $26.74 to $52.55 per share, for an average of $42.15 with a buy rating. As of April 2023, the company is trading -3.3% away from its average target price, indicating that there is an analyst consensus of some upside potential.

Freeport-McMoRan has a very low short interest because 1.1% of the company's shares are sold short. Institutions own 81.0% of the company's shares, and the insider ownership rate stands at 0.57%, suggesting a small amount of insider investors. The largest shareholder is Vanguard Group Inc, whose 8% stake in the company is worth $4,580,372,874.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.