Fact based stock research
Freeport-McMoRan (NYSE:FCX)

US35671D8570

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Freeport-McMoRan stock research in summary

fcx.com

ANALYSIS: With an Obermatt Combined Rank of 10 (worse than 90% compared with investment alternatives), Freeport-McMoRan (Copper, USA) shares have lower financial characteristics compared with similar stocks. Shares of Freeport-McMoRan are low in value (priced high) with a consolidated Value Rank of 16 (worse than 84% of alternatives) and show below-average growth (Growth Rank of 31) but are safely financed (Safety Rank of 63), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 10, is a sell recommendation based on Freeport-McMoRan's financial characteristics. As the company Freeport-McMoRan's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 16) and low growth (Obermatt Growth Rank of 31), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 63) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	16
Growth Rank	31
Safety Rank	63
Combined Rank	10

Country	USA
Industry	Copper
Index	Copper, Low Waste, Recycling, SDG 12, SDG 3, SDG 5, S&P 500
Size class	XX-Large

This stock has achievements: Top 10 Stock.

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Freeport-McMoRan

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	1	23	20	16
GROWTH
GROWTH	94	95	49	31
SAFETY
SAFETY	72	45	54	63
SENTIMENT
SENTIMENT	n/a	59	72	^new
360° VIEW
360° VIEW	n/a	59	45	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Freeport-McMoRan is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	1	23	20	16
GROWTH
GROWTH	94	95	49	31
SAFETY
SAFETY	72	45	54	63
COMBINED
COMBINED	61	60	24	10

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Freeport-McMoRan the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 16 (worse than 84% compared with alternatives), Freeport-McMoRan shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Freeport-McMoRan. Price-to-Sales is 36 which means that the stock price compared with what market professionals expect for future profits is higher than 64% of comparable companies, indicating a low value concerning Freeport-McMoRan's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 8, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Freeport-McMoRan. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 24 and Dividend Yield, which is lower than 55% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 16, is a sell recommendation based on Freeport-McMoRan's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Freeport-McMoRan? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Freeport-McMoRan? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Freeport-McMoRan may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	11	28	31	36
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	39	49	27	24
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	12	7	5	8
DIVIDEND YIELD
DIVIDEND YIELD	1	39	42	45
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	1	23	20	16

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Freeport-McMoRan; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 31 (better than 31% compared with alternatives), Freeport-McMoRan shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for Freeport-McMoRan. Only Capital Growth has a good rank of 61, which means that currently professionals expect the company to grow its invested capital more than 35% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 44 which means that currently professionals expect the company to grow less than 56% of its competitors. Profit Growth with a rank of 35 and Stock Returns with a rank of 41 are also low (below 59% of alternative investments). ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 31, is a hold recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Freeport-McMoRan is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is limited here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	83	65	43	44
PROFIT GROWTH
PROFIT GROWTH	1	88	25	35
CAPITAL GROWTH
CAPITAL GROWTH	n/a	75	58	61
STOCK RETURNS
STOCK RETURNS	85	87	57	41
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	94	95	49	31

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Freeport-McMoRan.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 63 (better than 63% compared with alternatives), the company Freeport-McMoRan has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Freeport-McMoRan is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above-average for Freeport-McMoRan. Refinancing is at 59, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 59% of its competitors. Liquidity is also good at 67, meaning the company generates more profit to service its debt than 67% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 38, which means the company has an above-average debt-to-equity ratio. It has more debt than 62% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 63 (better than 63% compared with alternatives), Freeport-McMoRan has a financing structure that is safer than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and Freeport-McMoRan could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. In the long-term, investors may have a debt challenge with Freeport-McMoRan and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	77	21	28	38
REFINANCING
REFINANCING	19	98	55	59
LIQUIDITY
LIQUIDITY	83	27	62	67
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	72	45	54	63

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Freeport-McMoRan and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	52	43	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	94	64	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	28	78	^new
MARKET PULSE
MARKET PULSE	n/a	40	78	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	59	72	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Freeport-McMoRan.
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