Freeport-McMoRan's Copper Sales Fall Sparks Mixed Analyst Reactions, Long-Term Upside Remains In Play
Analyst Revisions: Following Freeport-McMoRan's fourth-quarter results, analysts have adjusted price forecasts and ratings, with JP Morgan maintaining a $48 target and Neutral rating, while others like Jefferies downgraded from Buy to Hold, lowering the forecast to $40.
Sales Expectations: The company anticipates significant sales volumes for 2025 but faces challenges in the first quarter due to paused shipments and higher costs, leading to expected cuts in earnings estimates despite potential long-term growth opportunities.
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Interest in Copper ETFs Increases After Positive Price Forecast Revision
Copper Price Forecast: UBS anticipates a significant rise in copper prices, projecting $11,500 per ton by March 2026 and $13,000 by year-end, driven by supply disruptions and strong demand from electrification and clean energy investments.
Supply Deficits: The bank has revised its deficit forecasts, expecting a 230,000-ton shortfall in 2025 and a 407,000-ton deficit in 2026, due to ongoing supply risks and disruptions in major producing countries like Chile and Peru.
Impact of U.S. Dollar and Interest Rates: A weaker U.S. dollar, influenced by potential Fed rate cuts, is expected to boost copper demand globally, easing financial pressures on manufacturers and construction firms, which will further support copper prices.
Growing Demand for Copper: UBS projects a 2.8% increase in global copper demand in both 2025 and 2026, fueled by investments in electric vehicles, renewable energy, and power grids, highlighting the metal's importance in achieving net-zero emissions.
Unusual Volume Alert: COPP ETF on Wednesday
ETF Performance: The ETF with the highest volume on Wednesday included Trilogy Metals and Freeport-McMoRan, both up about 5.2%, with significant trading volumes of over 31.6 million and 11.4 million shares, respectively.
Top and Bottom Performers: Hudbay Minerals was the best performer, increasing by 8.1%, while the Ishares MSCI India ETF lagged behind, trading down by approximately 0.4%.
Sprott Discovers a Metals ETF Focused on Undervalued Assets
Introduction of METL: Sprott Inc. launched the Sprott Active Metals & Miners ETF (METL), which invests in the entire metals and mining lifecycle, focusing on strategic metals like copper, uranium, silver, lithium, and steel, while emphasizing traditional miners, recyclers, and royalty companies.
Investment Strategy: Unlike typical ETFs, METL targets firms that are currently undervalued but have strong fundamentals, utilizing a combination of top-down sector research and bottom-up stock selection, with a management team that conducts extensive mine site visits to identify investment opportunities.
Sprott Introduces Active ETF for Metals and Mining Stocks
Launch of New ETF: Sprott Inc. has introduced the Sprott Active Metals & Miners ETF (METL), an actively managed fund aimed at long-term capital appreciation by investing in various companies within the metals and mining sector, including miners, recyclers, and royalty companies.
Investment Strategy and Management: The ETF employs a value-oriented and contrarian investment strategy, led by a team of experienced portfolio managers who focus on undervalued companies with strong fundamentals, while also conducting extensive sector analysis and site visits to identify investment opportunities.
China Showed Its Death Grip On Rare Earths During Trump Tariff War, But Craig Shapiro Says This $2 Billion Plan Will Secure US Supply: Here's How
U.S. Supply Chain Vulnerability: Economist Craig Shapiro highlights the U.S.'s critical reliance on China for rare earth magnets, essential for various technologies, and proposes a cost-effective strategy to enhance domestic production and reduce dependency.
Investment Opportunities: Shapiro advises investors to focus on companies involved in rare earth materials and suggests exploring urban mining and strategic metals ETFs as potential investment avenues amidst the current supply chain challenges.
World's Largest Copper Producer Freeport Estimates Proposed Tariffs Could Raise US Cost Of Goods Purchased By 5%
Quarterly Performance: Freeport-McMoRan reported a first-quarter FY25 revenue of $5.73 billion, surpassing expectations, with copper sales volumes at 872 million pounds despite a year-over-year decline due to maintenance in Indonesia. Adjusted EPS was $0.24, and operating cash flow totaled $1.06 billion.
2025 Outlook: The company anticipates copper sales volumes of 4.0 billion pounds and expects a reduction in average unit net cash costs for U.S. copper mines, projecting operating cash flows of approximately $7 billion and capital expenditures of $4.4 billion for the year.
Interest in Copper ETFs Increases After Positive Price Forecast Revision
Copper Price Forecast: UBS anticipates a significant rise in copper prices, projecting $11,500 per ton by March 2026 and $13,000 by year-end, driven by supply disruptions and strong demand from electrification and clean energy investments.
Supply Deficits: The bank has revised its deficit forecasts, expecting a 230,000-ton shortfall in 2025 and a 407,000-ton deficit in 2026, due to ongoing supply risks and disruptions in major producing countries like Chile and Peru.
Impact of U.S. Dollar and Interest Rates: A weaker U.S. dollar, influenced by potential Fed rate cuts, is expected to boost copper demand globally, easing financial pressures on manufacturers and construction firms, which will further support copper prices.
Growing Demand for Copper: UBS projects a 2.8% increase in global copper demand in both 2025 and 2026, fueled by investments in electric vehicles, renewable energy, and power grids, highlighting the metal's importance in achieving net-zero emissions.
Unusual Volume Alert: COPP ETF on Wednesday
ETF Performance: The ETF with the highest volume on Wednesday included Trilogy Metals and Freeport-McMoRan, both up about 5.2%, with significant trading volumes of over 31.6 million and 11.4 million shares, respectively.
Top and Bottom Performers: Hudbay Minerals was the best performer, increasing by 8.1%, while the Ishares MSCI India ETF lagged behind, trading down by approximately 0.4%.
Sprott Discovers a Metals ETF Focused on Undervalued Assets
Introduction of METL: Sprott Inc. launched the Sprott Active Metals & Miners ETF (METL), which invests in the entire metals and mining lifecycle, focusing on strategic metals like copper, uranium, silver, lithium, and steel, while emphasizing traditional miners, recyclers, and royalty companies.
Investment Strategy: Unlike typical ETFs, METL targets firms that are currently undervalued but have strong fundamentals, utilizing a combination of top-down sector research and bottom-up stock selection, with a management team that conducts extensive mine site visits to identify investment opportunities.
Sprott Introduces Active ETF for Metals and Mining Stocks
Launch of New ETF: Sprott Inc. has introduced the Sprott Active Metals & Miners ETF (METL), an actively managed fund aimed at long-term capital appreciation by investing in various companies within the metals and mining sector, including miners, recyclers, and royalty companies.
Investment Strategy and Management: The ETF employs a value-oriented and contrarian investment strategy, led by a team of experienced portfolio managers who focus on undervalued companies with strong fundamentals, while also conducting extensive sector analysis and site visits to identify investment opportunities.
China Showed Its Death Grip On Rare Earths During Trump Tariff War, But Craig Shapiro Says This $2 Billion Plan Will Secure US Supply: Here's How
U.S. Supply Chain Vulnerability: Economist Craig Shapiro highlights the U.S.'s critical reliance on China for rare earth magnets, essential for various technologies, and proposes a cost-effective strategy to enhance domestic production and reduce dependency.
Investment Opportunities: Shapiro advises investors to focus on companies involved in rare earth materials and suggests exploring urban mining and strategic metals ETFs as potential investment avenues amidst the current supply chain challenges.
World's Largest Copper Producer Freeport Estimates Proposed Tariffs Could Raise US Cost Of Goods Purchased By 5%
Quarterly Performance: Freeport-McMoRan reported a first-quarter FY25 revenue of $5.73 billion, surpassing expectations, with copper sales volumes at 872 million pounds despite a year-over-year decline due to maintenance in Indonesia. Adjusted EPS was $0.24, and operating cash flow totaled $1.06 billion.
2025 Outlook: The company anticipates copper sales volumes of 4.0 billion pounds and expects a reduction in average unit net cash costs for U.S. copper mines, projecting operating cash flows of approximately $7 billion and capital expenditures of $4.4 billion for the year.
