Opinions
Gordon Reid
Freeport McMoran Copper & Gold
FCX-N
TOP PICK
Apr 09, 2025
Stock price when the opinion was issued
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Copper stocks are very volatile. He uses stop losses on all positions, so ended up coming out of this one. Re-entered about 2 months ago. Should generate a lot of cash longer term. Significant dividend grower. Should actually benefit from tariffs.
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.
Taken a big hit. Divergence between copper prices and company's performance. Generational opportunity to buy a company like this. Secularly, we're using more and more copper for electrification. Analysts see 7-8% compound growth rate in copper usage over next 10 years. Yield is 2.01%.
(Analysts’ price target is $46.78)The negative is that 50% of copper is used by China. If tariffs don't get sorted out, something's gotta give. It's not easy to bring mines on quickly. Good risk/reward at current levels.