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Why the Market Gave a Thumbs Down to Freeport’s 4Q16 Earnings

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Jan. 26 2017, Published 1:30 p.m. ET

Freeport’s 4Q16 earnings

Freeport-McMoRan (FCX), the world’s second-largest copper miner, released its 4Q16 financial results before the market opened on January 25, 2017. The company reported adjusted EPS (earnings per share) of $0.25. Analysts polled by Thomson Reuters had expected the company to post adjusted EPS of $0.33 in the quarter.

4Q16 was the second consecutive quarter during which Freeport missed its consensus EPS estimate. However, while the market shrugged off Freeport’s 3Q16 earnings miss, the stock saw selling pressures following its 4Q16 earnings release. Though Freeport managed to recoup some of its intraday losses, the stock still closed at a fall of 3.1% on January 25.

Metals and mining stocks have had a subdued earnings season. Alcoa, Steel Dynamics, and AK Steel saw negative price action following their respective 4Q16 earnings releases. Prior to that, metals stocks were flying high following Donald Trump’s election as the US president.

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Other copper producers

Looking at other copper producers (SCCO), Teck Resources’ (TCK) 4Q16 financial results are scheduled for release on February 15, 2017. Glencore (GLNCY) is scheduled to release its 2016 production report on February 2, 2017, followed by its preliminary 2016 annual results on February 23. Turquoise Hill Resources (TRQ) (RIO) has already released its 4Q16 production report.

Series overview

In this series, we’ll explore Freeport’s 4Q16 earnings in detail. We’ll also cover key points from the company’s 4Q16 earnings conference call. Let’s begin by looking at Freeport’s 4Q16 revenue in the next part of this series.

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