FEATURES – MAIN

Worries about the Iran war have rocked financial markets, raising concerns that higher oil prices will lead to a global economic slowdown. Copper, one of the more highly cyclical metals, has pulled back as a result—as have shares of

Freeport-McMoRan

the largest copper miner in the U.S.

This dip creates a compelling buying opportunity for a stock that has a lot going for it. Freeport is down more than 10% from its 52-week high. That still leaves it up by about 20% this year—and more than 75% over the past 12 months. Much of these gains come from expectations for demand tied to the need for copper wiring in data centers. But the stock is more than a proxy for copper prices, which even after the Iran dip are still up about 4.5% this year and more than 25% since March 2025.

Wall Street’s consensus price target for the stock is $68.62, according to FactSet. That’s about 10% higher than current levels. It could prove to be too conservative.

For one, copper’s rally likely has room to run. The artificial-intelligence buildout is one reason why analysts at Bank of America said in a March report that copper is a “future facing” commodity that “everybody seems to want.” BofA argues that longer-term energy transition trends, including demand for AI and data centers as well as increased electrification, should be a positive for Freeport and other leading copper miners. It forecasts that copper will hit $7.26 a pound by the second half of next year, almost 25% higher than current prices.

Kevin Smith, chief investment officer of Crescat Capital, tells Barron’s that this is just the beginning of a new long-term bull market for copper. He argues that the recent pullback due to worries about Iran and higher oil prices are temporary and an overreaction. Crescat runs a hedge fund focusing on precious and base metals miners and owns Freeport shares.

“It’s a buying opportunity for Freeport-McMoRan and other copper miners,” Smith says, adding that he wouldn’t be surprised to see copper prices rise another 20% to 25% from current levels.   

Any increase in prices for the metal should quickly flow to the company’s bottom line. Wall Street is currently forecasting a profit of $2.85 a share this year, up more than 60% from 2025. Analysts predict earnings will rise another 30% in 2027, to $3.71 a share. It’s no wonder that 20 of the 25 analysts who cover Freeport have rated the stock Buy or Outperform.

Freeport is also cheap compared with many competitors. BofA says the stock now “stands out as relatively inexpensive…compared to large-cap copper peers.” It trades at about 21 times 2026 earnings estimates, while

Southern Copper

clocks in at a forward price/earnings ratio of about 29. Freeport is valued at around 7.5 times enterprise value to earnings before interest, taxes, depreciation, and amortization, or Ebitda, for the next 12 months. Rivals such as Chile’s

Antofagasta

and Canada’s

Lundin Mining

and

Ivanhoe Mines

trade at enterprise-value-to-Ebitda multiples of 8.5 to 10.

One reason for the discount is a fatal mudslide accident at Freeport’s Grasberg mine in Indonesia last September. Beyond the human tragedy, the event has led to concerns about production. The BofA team says the market is “potentially taking a ‘wait and see’ approach on operational recovery.” The market may be making too much of this.

Other analysts argue that the worries about the Indonesian operations are overdone. Daniel Major, an analyst at UBS, said in January following the company’s latest earnings report that visibility on the ramping up of the Grasberg mine is improving. As such, he boosted his price target from $60 a share to $70, which is about 13% higher than the current price. Major said the $70 target values the stock at 9.5 times Ebitda, which is roughly in line with its three-year average multiple.

Jefferies analyst Christopher LaFemina is also bullish, calling Freeport one of his top picks in the mining sector. He recently lifted his price target to $76 a share, writing in a report that he expects “a recovery in Grasberg production alongside a structurally higher copper price over time to drive meaningful upside” to the stock.

LaFemina does concede that “there is of course some risk to the timing of recovery to full production” and that the Grasberg mine won’t be back to 100% capacity until the end of 2027. But he also notes that the company’s own production guidance figures are “beatable.”

Investors also shouldn’t underestimate the possibility of stimulus from the U.S. government for Freeport and other domestic copper miners. President Donald Trump has made it no secret that his administration views copper as a “critical mineral.” Freeport-McMoRan CEO Kathleen Quirk addressed the question of funding from Washington at a BMO Capital Markets conference in February, saying that “the government has made it clear that they would like to facilitate the U.S. copper industry.” She added that although the company has “access to more conventional types of financing…we’ll look at all the opportunities there.”

The good news is that as long as copper prices remain stable, or creep higher, the company isn’t actually in need of federal assistance. After all, Freeport has more than $4 billion in cash, and its long-term-debt-to-capital ratio of 34% is below its five-year average. The balance sheet is healthy.

There are some risks. If the company isn’t able to get the Grasberg mine operational as quickly as it expects, production could take a hit. And copper prices may pull back again if the situation with Iran intensifies further and oil prices spike once more.

So, yes, copper prices may remain volatile in the short term, but Freeport should be able to withstand that given the strong demand for copper overall. The eventual full reopening of the Grasberg mine will give the company some additional juice, meaning that the valuation gap between it and its peers should steadily narrow. There’s lots of green ahead for the red metal—and Freeport-McMoRan stock.

THE TECHNICAL VIEW

The copper play now trades 10% off its most recent 52-week high. Respect the quick recapture of its 50-day simple moving average this week. It recorded a bullish piercing line candle on March 9 and is now carving out a double bottom pattern. Sizable weekly reversals in the weeks ending Jan. 30 and March 6 have not derailed the bulls. The weekly chart broke above a bullish inverse head and shoulders pivot near the round $50 number at the end of 2025. Think this can get to $77 by mid 2026, corresponding to a gain of 22% from current prices. Remain bullish above $58.50. —Doug Busch

THE QUANTITATIVE VIEW

Bottom Line: FCX screens strongly on momentum, revisions, investment ranking, and size factors. The company also shows solid profitability, growth, and quality persistence, indicating stable operational performance within the metals and mining sector. However, valuation metrics remain weaker, reflecting the stock’s strong recent performance and commodity-cycle sensitivity.

Bias: Positive / Accumulate. Strong momentum, revisions strength, and macro alignment support a constructive outlook. Entry opportunities may arise during commodity-driven volatility or broader materials sector pullbacks.

Overall: The stock remains aligned with the current macro environment and may benefit from exposure to global copper demand, momentum and technicals strength in the materials sector, and improving revisions and dispersion metrics. Investors should monitor commodity price trends, global industrial demand, and the stability of earnings revisions as key drivers for sustained relative performance. —Vestmo

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