Amidst Strong Rally In Copper Price, Will Freeport-McMoRan Stock Continue To Shine?

Freeport-McMoRan stock (NYSE: FCX) is up 13% in just one week, completely outperforming the S&P 500 which was up less than 2%. If you look at the change over the last ten days and one month, the stock has returned 18% and 13%, respectively, thus having outperformed the market on both occasions. FCX stock was up last week following a sharp rise in global copper prices. Copper price per pound increased from $4.20 to $4.70, a jump of 12% in a week. The primary trigger for this rise is tight global supply, as copper inventories at the London Metal Exchange (LME) have dropped to levels last seen in 1974. LME has only about 14,150 metric tons of copper not earmarked for delivery. To put things in perspective, annual global consumption of copper generally stands at 25 million metric tons. At the same time, global gold prices have also exhibited strength recently. Freeport-McMoRan is the largest U.S.-based copper mining company based on 2020 production numbers, with a small part of its revenue also coming from gold. With the copper and gold prices on an upswing over recent weeks, investors are expecting FCX to report strong Q3 2021 numbers in the second half of October. They are also expectations of a larger dividend payout on the back of strong improvement in cash from operations.

Now, is FCX stock set to rise further or could we expect some correction? We believe that there is a 57% chance of a rise in FCX stock over the next month (21 trading days) based on our machine learning analysis of trends in the stock price over the last ten years. See our analysis on FCX Stock Chance of Rise. For additional details about FCX historical returns and comparison to peers, see Freeport-McMoRan (FCX) Stock Return.

Twenty-One Day: FCX 13%, vs. S&P500 –0.3%; Outperformed market

(19% likelihood event; 57% probability of rise over next 21 days)

• FCX stock increased 13% the last twenty-one trading days (one month), compared to a broader market (S&P500) drop of 0.3%
• A change of 13% or more over twenty-one trading days is a 19% likelihood event, which has occurred 468 times out of 2516 in the last 10 years
• Of these 468 instances, the stock has seen a positive movement over the next twenty-one trading days on 268 occasions
• This points to a 57% probability for the stock rising over the next twenty-one trading days

Ten Day: FCX 18%, vs. S&P500 2.7%; Outperformed market

(5% likelihood event; 60% probability of rise over next 10 days)

• FCX stock increased 18% over the last ten trading days (two weeks), compared to broader market (S&P500) rise of 2.7%
• A change of 18% or more over ten trading days is an 5% likelihood event, which has occurred 120 times out of 2517 in the last 10 years
• Of these 120 instances, the stock has seen a positive movement over the next ten trading days on 72 occasions
• This points to a 60% probability for the stock rising over the next ten trading days

Five Day: FCX 13%, vs. S&P500 1.8%; Outperformed market

(4% likelihood event; 43% probability of rise over next five days)

• FCX stock increased 13% over a five-day trading period ending 10/15/2021, compared to the broader market (S&P500) marginal rise of 1.8%
• A change of 13% or more over five trading days (one week) is a 4% likelihood event, which has occurred 113 times out of 2517 in the last ten years
• Of these 113 instances, the stock has seen a positive movement over the next five trading days on 49 occasions
• This points to a 43% probability for the stock rising over the next five trading days

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