NYSE:FCX

Stock Analysis Report

Executive Summary

Freeport-McMoRan Inc. engages in the mining of mineral properties in North America, South America, and Indonesia.

Rewards

Trading at 86.3% below its fair value

Earnings are forecast to grow 58.78% per year

Risk Analysis

Interest payments are not well covered by earnings

Dividend of 1.77% is not well covered by earnings

Large one-off items impacting financial results

Profit margins (1.6%) are lower than last year (15.8%)



Snowflake Analysis

High growth potential and slightly overvalued.


Similar Companies

Share Price & News

How has Freeport-McMoRan's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: FCX has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-2.4%

FCX

1.3%

US Metals and Mining

-1.2%

US Market


1 Year Return

1.6%

FCX

10.5%

US Metals and Mining

15.5%

US Market

Return vs Industry: FCX underperformed the US Metals and Mining industry which returned 10.5% over the past year.

Return vs Market: FCX underperformed the US Market which returned 15.5% over the past year.


Shareholder returns

FCXIndustryMarket
7 Day-2.4%1.3%-1.2%
30 Day3.9%2.5%1.4%
90 Day20.3%10.6%4.7%
1 Year3.5%1.6%13.8%10.5%18.0%15.5%
3 Year-25.3%-27.4%-0.8%-6.0%44.8%35.4%
5 Year-47.8%-50.7%25.4%15.4%67.3%48.9%

Price Volatility Vs. Market

How volatile is Freeport-McMoRan's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Freeport-McMoRan undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: FCX ($11.33) is trading below our estimate of fair value ($82.63)

Significantly Below Fair Value: FCX is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: FCX is poor value based on its PE Ratio (71.8x) compared to the Metals and Mining industry average (11.9x).

PE vs Market: FCX is poor value based on its PE Ratio (71.8x) compared to the US market (18.3x).


Price to Earnings Growth Ratio

PEG Ratio: FCX is poor value based on its PEG Ratio (1.2x)


Price to Book Ratio

PB vs Industry: FCX is overvalued based on its PB Ratio (1.7x) compared to the US Metals and Mining industry average (1.6x).


Next Steps

Future Growth

How is Freeport-McMoRan forecast to perform in the next 1 to 3 years based on estimates from 15 analysts?

58.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: FCX's forecast earnings growth (58.8% per year) is above the savings rate (1.7%).

Earnings vs Market: FCX's earnings (58.8% per year) are forecast to grow faster than the US market (14.2% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: FCX's revenue (10.5% per year) is forecast to grow faster than the US market (7.4% per year).

High Growth Revenue: FCX's revenue (10.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: FCX's Return on Equity is forecast to be high in 3 years time (20.7%)


Next Steps

Past Performance

How has Freeport-McMoRan performed over the past 5 years?

47.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: FCX has a large one-off loss of $333.0M impacting its September 30 2019 financial results.

Growing Profit Margin: FCX's current net profit margins (1.6%) are lower than last year (15.8%).


Past Earnings Growth Analysis

Earnings Trend: FCX has become profitable over the past 5 years, growing earnings by 47% per year.

Accelerating Growth: FCX's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: FCX had negative earnings growth (-92.7%) over the past year, making it difficult to compare to the Metals and Mining industry average (0.7%).


Return on Equity

High ROE: FCX's Return on Equity (0.8%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Freeport-McMoRan's financial position?


Financial Position Analysis

Short Term Liabilities: FCX's short term assets ($8.3B) exceed its short term liabilities ($3.4B).

Long Term Liabilities: FCX's short term assets ($8.3B) do not cover its long term liabilities ($20.0B).


Debt to Equity History and Analysis

Debt Level: FCX's debt to equity ratio (56.5%) is considered high.

Reducing Debt: FCX's debt to equity ratio has reduced from 73.9% to 56.5% over the past 5 years.

Debt Coverage: FCX's debt is not well covered by operating cash flow (12.6%).

Interest Coverage: FCX's interest payments on its debt are not well covered by EBIT (1.1x coverage).


Balance Sheet

Inventory Level: FCX has a high level of physical assets or inventory.

Debt Coverage by Assets: FCX's debt is not covered by short term assets (assets are 0.8x debt).


Next Steps

Dividend

What is Freeport-McMoRan's current dividend yield, its reliability and sustainability?

1.77%

Current Dividend Yield


Dividend Yield vs Market

company1.8%marketbottom25%1.4%markettop25%3.7%industryaverage2.4%forecastin3Years2.1%

Current dividend yield vs market & industry

Notable Dividend: FCX's dividend (1.77%) is higher than the bottom 25% of dividend payers in the US market (1.43%).

High Dividend: FCX's dividend (1.77%) is low compared to the top 25% of dividend payers in the US market (3.71%).


Stability and Growth of Payments

Stable Dividend: FCX's dividend payments have been volatile in the past 10 years.

Growing Dividend: FCX's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (126.7%), FCX's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: FCX's dividends in 3 years are forecast to be thoroughly covered by earnings (12.8% payout ratio).


Next Steps

Management

What is the CEO of Freeport-McMoRan's salary, the management and board of directors tenure and is there insider trading?

12.9yrs

Average management tenure


CEO

Richard Adkerson (72yo)

16yrs

Tenure

US$16,424,035

Compensation

Mr. Richard C. Adkerson has been the President of Freeport-Mcmoran Oil & Gas LLC since January 1, 2008 and its Chief Executive Officer since December 10, 2003. Mr. Adkerson serves as an Executive Vice Pres ...


CEO Compensation Analysis

Compensation vs Market: Richard's total compensation ($USD16.42M) is above average for companies of similar size in the US market ($USD11.01M).

Compensation vs Earnings: Richard's compensation has been consistent with company performance over the past year.


Management Age and Tenure

12.9yrs

Average Tenure

63yo

Average Age

Experienced Management: FCX's management team is seasoned and experienced (12.9 years average tenure).


Board Age and Tenure

6.0yrs

Average Tenure

73.5yo

Average Age

Experienced Board: FCX's board of directors are considered experienced (6 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$524,34010 Jun 19
Kathleen Quirk
EntityIndividual
Role
Chief Financial Officer
Executive VP & CFO
Shares50,000
Max PriceUS$10.49
BuyUS$1,744,08006 Jun 19
Richard Adkerson
EntityIndividual
Role
Chief Executive Officer
Vice Chairman
Shares172,000
Max PriceUS$10.14
SellUS$85,95513 Feb 19
C. Whitmire
EntityIndividual
Shares7,425
Max PriceUS$11.58

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Kathleen Quirk (55yo)

    Executive VP & CFO

    • Tenure: 16yrs
    • Compensation: US$6.78m
  • Richard Adkerson (72yo)

    Vice Chairman

    • Tenure: 16yrs
    • Compensation: US$16.42m
  • W. King (69yo)

    Senior Vice President of International Relations & Federal Government Affairs

    • Tenure: 0yrs
  • Red Conger (63yo)

    President & COO of Americas

    • Tenure: 12.9yrs
    • Compensation: US$4.74m
  • Mark Johnson (60yo)

    President & COO of Freeport-McMoRan Indonesia

    • Tenure: 4.4yrs
    • Compensation: US$4.18m
  • Dean Falgoust (61yo)

    President of FMS & VP of FCX

    • Tenure: 0yrs
  • Javier Targhetta

    Senior Vice President of FCX - Concentrates

    • Tenure: 0yrs
  • Lynne Cooney

    VP & Assistant to the Chairman

    • Tenure: 0yrs
  • Stephen Higgins

    Senior VP & Chief Administrative Officer

    • Tenure: 0yrs
  • L. McMillan (72yo)

    Senior VP & General Counsel

    • Tenure: 12.2yrs

Board Members

  • Dustan McCoy (69yo)

    Independent Director

    • Tenure: 12.9yrs
    • Compensation: US$277.50k
  • James Moffett (81yo)

    Chairman Emeritus

    • Tenure: 4yrs
    • Compensation: US$24.82m
  • Richard Adkerson (72yo)

    Vice Chairman

    • Tenure: 16yrs
    • Compensation: US$16.42m
  • J. Johnston (86yo)

    Member of Advisory Board

    • Tenure: 0yrs
    • Compensation: US$779.79k
  • Henry Kissinger (95yo)

    Director Emeritus

    • Tenure: 0yrs
  • Jerry Ford (75yo)

    Non-Executive Chairman of the Board

    • Tenure: 4yrs
    • Compensation: US$327.03k
  • J. Roy (82yo)

    Member of Advisory Board

    • Tenure: 0yrs
    • Compensation: US$555.93k
  • Lydia Kennard (64yo)

    Independent Director

    • Tenure: 6yrs
    • Compensation: US$264.54k
  • John Stephens (60yo)

    Director

    • Tenure: 0.2yrs
  • Frances Fragos Townsend (57yo)

    Independent Director

    • Tenure: 6.9yrs
    • Compensation: US$269.55k

Company Information

Freeport-McMoRan Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Freeport-McMoRan Inc.
  • Ticker: FCX
  • Exchange: NYSE
  • Founded: 1987
  • Industry: Copper
  • Sector: Materials
  • Market Cap: US$15.844b
  • Shares outstanding: 1.45b
  • Website: https://www.fcx.com

Number of Employees


Location

  • Freeport-McMoRan Inc.
  • 333 North Central Avenue
  • Phoenix
  • Arizona
  • 85004
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
FCXNYSE (New York Stock Exchange)YesClass B Common StockUSUSDJul 1995
FPMBETLX (Eurotlx)YesClass B Common StockITEURJul 1995
FCX *BMV (Bolsa Mexicana de Valores)YesClass B Common StockMXMXNJul 1995
FPMBXTRA (XETRA Trading Platform)YesClass B Common StockDEEURJul 1995
FCXWBAG (Wiener Boerse AG)YesClass B Common StockATEURJul 1995
FPMBDB (Deutsche Boerse AG)YesClass B Common StockDEEURJul 1995
FCXSNSE (Santiago Stock Exchange)YesClass B Common StockCLUSDJul 1995
0R2OLSE (London Stock Exchange)YesClass B Common StockGBUSDJul 1995
FCXBVL (Bolsa de Valores de Lima)YesClass B Common StockPEUSDJul 1995
FCXBASE (Buenos Aires Stock Exchange)CEDEAR EACH REP 1 ORD SHSARARSApr 2011
FCXO34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH REPR 1 COM SHBRBRLJan 2012

Biography

Freeport-McMoRan Inc. engages in the mining of mineral properties in North America, South America, and Indonesia. The company primarily explores for copper, gold, molybdenum, silver, and other metals, as w ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/05 23:37
End of Day Share Price2019/12/05 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.