David Burrows Freeport McMoran Copper & Gold FCX-N HOLD Aug 19, 2021

Obvious way to play the copper sector. Copper and gold. Significant breakout in the price of copper. Great dividend growth stock over time. Big cash generator.

If copper stays at $5, they should produce $9 billion in free cash flow or 15% free cash flow yield.

Q2 beat. She's still bullish on gold and copper. More cyclical than large-cap tech or utilities. Strong US operations. A bit volatile for her, but still some upside of about 8% to price target from here.

If copper stays above $5, FCX will see $9 billion in free cash flow. Shares are not cheap at 20x PE, but earnings growth is a huge 20-40%. Fundamentally, shares should be much higher.

It has a hard time breaking $45-46. It's now at the upper end of its trading range, so sell calls. Just reported nice numbers.

The question also asked about his opinion in general on copper. He likes copper which is the most important of the metals and is therefore in great demand. The price of copper has been hit by tariffs. It is hard to predict the price by random events and the Trump effect. Freeport McMoran is in the U.S. so it has that plus.

China is the biggest buyer of copper in the world, over 50% worldwide. Long-term, copper is a winner, used widely (power generation, EVs, and elsewhere). FCX is one of the largest copper companies, the biggest in the U.S. FCX has bounced around because of Trump's tariffs. He will sit tight, but expected copper demand to double in coming years.

Very significant drop in copper price recently, due to US tariffs being clarified. Yet copper stocks were remarkably resilient. 

This name has wonderful long-life assets. Trading above 50-, 150-, and 200-day MAs. Not strongest copper stock technically, but technicals are fine. Great company with history of raising dividend over time. If inflation rises tomorrow, they can put prices up. See his Top Picks.

Tariff policy is uncertain, as we could have an announcement today that gets changed next week. 200-day MA is falling, but at least the price is above that. Likes the space. Would be great if China picked up, as that would really propel the stock.

Sees signs that we could see a pickup down the road, but he's neutral for now.

To invest in this you need to be positive on copper which he is with the electrification of everything and the build out of data centres. Also global growth, especially China, could push the commodity price up. It has great assets and great jurisdictions. It also has long asset life to get through downturns in the price of copper. A catalyst in the coming quarters is its production of really high margin gold by-products. We have an elevated gold price and could see earnings estimates increased.         Buy 16  Hold 6  Sell 1