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How Analysts Rate Freeport following Its 2Q16 Earnings Release

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Analysts’ ratings

According to consensus estimates compiled by Bloomberg, Freeport-McMoRan (FCX) has a one-year price target of $12.01. That’s a 3.1% downside over its August 2, 2016, closing price.

Of the 19 analysts surveyed by Bloomberg, only three rate the stock as a “buy,” while one rates it as a “sell.” The remaining 15 analysts rate the stock as a “hold.”

As we can see, most analysts still rate Freeport as a “hold.” The same is true for other miners (XME) such as BHP Billiton (BHP), Southern Copper (SCCO), and Rio Tinto (RIO).

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Recent actions

The chart above shows Wall Street analysts’ recent actions on Freeport. Several analysts have revised their target prices for Freeport following its 2Q16 earnings release. Macquarie has raised Freeport’s one-year target price from $10 to $13 while maintaining its “neutral” rating.

Scotia Capital has also raised Freeport’s target price from $13 to $13.5. Incidentally, Scotia had raised Freeport’s target price from $10.5 to $13 before its 2Q16 earnings release. Clarksons Platou Securities had also raised Freeport’s target price from $11 to $13 before the company’s 2Q16 earnings release.

Goldman Sachs

Most analysts have either maintained or increased Freeport’s target price. However, Goldman Sachs has cut Freeport’s target price from $12 to $11 after its 2Q16 earnings release. The brokerage has been bearish on base metals for some time now.

Earlier this year, Goldman Sachs said that copper prices could fall toward $4,000 per metric ton. However, copper is currently trading in the ballpark of $5,000 per metric ton.

In the next part of the series, we’ll take a closer look at Freeport’s 2Q16 earnings.

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