1. Freeport-McMoRan Inc. (NYSE:FCX)
Fisher Asset Management’s Stake Value: $2,524,330,000
Percentage of Fisher Asset Management’s 13F Portfolio: 1.48%
PE Ratio as of June 14: 9.66
Number of Hedge Fund Holders: 68
At the close of Q1 2022, 68 hedge funds were bullish on Freeport-McMoran Inc. (NYSE:FCX). These funds held collective stakes worth $4.10 billion in the company, up from $3.77 billion in the previous quarter with 66 positions. The hedge fund sentiment for the stock is positive.
This April, Freeport-McMoran Inc. (NYSE:FCX) posted gains for the first quarter of fiscal year 2022. The company’s revenue for the quarter amounted to $6.60 billion, up 36.14% year over year, and outperformed market consensus by $148.02 million. Freeport-McMoran Inc. (NYSE:FCX) registered an EPS of $1.07, ahead of Wall Street expectations by $0.15. Moreover, as of June 14, Freeport-McMoran Inc. (NYSE:FCX) has a forward price-to-earnings ratio of 9.66.
On June 9, Credit Suisse analyst Curt Woodworth raised his price target on Freeport-McMoran Inc. (NYSE:FCX) to $38 from $32 and upgraded the stock to Neutral from Underperform. Woodworth noted that he sees copper prices to sit at higher levels in the medium term which makes the risk/reward ratio for copper bullish, and the risk/reward ratio for Freeport-McMoran Inc. (NYSE:FCX) “more neutral”.
As of Q1 2022, Fisher Asset Management is the top shareholder in Freeport-McMoran Inc. (NYSE:FCX), owning over 50.75 million shares of the company. As of March 31, the fund’s stakes in the company are valued at $2.52 billion, up 4% from the fund’s Q4 2021 stakes. Freeport-McMoran Inc. (NYSE:FCX) covers 1.48% of Ken Fisher’s 13F portfolio.
Here is what Horizon Kinetics LLC, an investment management firm, said about Freeport-McMoran Inc. (NYSE:FCX) in its fourth-quarter 2021 investor letter:
“Those were some ideas about copper demand. Here are some specifics about supply. Global copper mine production in the 10 years from 2005 to 2015 rose 2.45% annually. In the next 5 years, to 2020, it increased by only 0.9% annually. Even ignoring the 2020 pandemic year, for the 4 years from to 2019, the expansion rate was 1.66%. We already have the historical context for this: the commodity price collapse prior to 2015, from a position of excess capacity.
What producers must do in that situation, because they have high fixed costs and debt expense, is curtail their exploration and development expenditures and reduce operating costs. They rely on existing mines, instead, and on their highest-grade ores and lowest-cost production. They might not actually reduce current production, but they aren’t replacing the reserves that are being slowly drawn down. You can see this at work at the individual company level.
Freeport-McMoRan will illustrate. It is the world’s third-largest copper producer, closely following Chile’s Codelco and Australia’s BHP Group. In 2014, even though Freeport sold more copper than the prior year, its revenues dropped by over 25%, and it went from $4.8 billion of operating earnings (a 22% margin) to a $(0.2) billion loss. The company’s capital expenditures peaked in 2014 at $3.86 billion and will be about $1.72 billion in 2021, meaning the company is spending 55% less now than it was seven years ago. In inflation-adjusted terms, it’s spending 61% less today than seven years ago…” (Click here to see the full text)
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