Despite rising gold and copper prices, Freeport-McMoRan (FCX) stock has dropped 8% in the past month

From Nasdaq: 2024-11-04 20:52:04

Freeport-McMoRan (NYSE: FCX) stock has dropped 8% in the past month despite gold realizations rising 35% and copper realizations up 13% in Q3 2024. Valuation is around $47 per share, in line with the market price, suggesting optimism is already factored in.

As a major copper producer, Freeport is poised to benefit from the future outlook of copper, with demand increasing due to investments in electrical infrastructure and AI data centers. The company also benefits from rising gold prices, with gold sales volume in Q3 2024 up 40% year-on-year.

Freeport stock has shown volatile returns over the past three years, with annual returns ranging from 61% in 2021 to -7% in 2022. The Trefis High Quality Portfolio has outperformed the S&P 500 each year over the same period, offering less volatility and better returns.

Despite positive long-term demand for copper, Freeport remains susceptible to market fluctuations and changes in government policies. The El Abra project in Chile, set to commission in 2033, could impact the company if there are delays or cost increases.

In October 2024, Freeport stock returned -8% month-to-date, 9% year-to-date, and 276% since 2017. Comparatively, the S&P 500 returned 1% month-to-date, 22% year-to-date, and 161% since 2017.

Investors should consider the risks associated with Freeport’s exposure to commodity market fluctuations and potential delays in projects like El Abra in Chile. Despite recent performance, the company’s long-term outlook remains positive.



Read more at Nasdaq: Why FCX Stock Hasn’t Gained Much From Record Gold Prices?