Please ensure Javascript is enabled for purposes of website accessibility

Why Freeport-McMoRan Stock Jumped 11% in July

By Reuben Gregg Brewer – Aug 6, 2020 at 10:24AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The copper miner's shares saw a quick rise followed by a slight drop from their monthly highs.

What happened

Shares of copper miner Freeport-McMoRan (FCX 0.73%) gained roughly 11% in July, according to data from S&P Global Market Intelligence. That advance, however, wasn't a straight line. The shares were up by nearly 18% at one point in the middle of the month, but then pulled back in the back half of the period, which makes complete sense when you step back and look at the big picture.

So what

Freeport-McMoRan reported earnings in late July. The story was pretty good, all things considered. The miner posted earnings of roughly $0.03 per share in the second quarter, compared from a loss of $0.05 per share in the same period of 2019. It also highlighted that it was doing OK managing its business through the COVID-19 pandemic. Copper production and pricing were lower year over year, but gold production and pricing were both higher. Add those trends to cost-containment efforts, and the overall results were decent.   

A pile of copper pipes stacked atop each other

Image source: Getty Images

The thing is, at its core, Freeport-McMoRan is a miner, and its primary product is copper. Thus, in normal times, the stock tends to track along with the price of that industrial metal. So with the business basically operating fairly well, July's stock performance was pretty much what you would expect. Indeed, copper prices rose sharply at the start of the month, as did Freeport-McMoRan's shares. Copper then pulled back a little in the second half of July, and the stock followed suit.   

Now what

Compared to the volatility caused by COVID-19, which resulted in Freeport-McMoRan's shares falling roughly 60% at one point earlier in the year, July was a pretty boring month. The fact that the stock basically tracked copper's performance was exactly what investors would hope to see. Down just 1.5% or so through the first seven months of 2020, Freeport-McMoRan is no more out of the COVID-19 shadow than any other company. But at least for now, things appear to be more normal than they were earlier in the year.

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Freeport-McMoRan Inc. Stock Quote
Freeport-McMoRan Inc.
$26.88 (0.73%) $0.20

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/26/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.