While the tariff situation remains dynamic, one thing is crystal clear: The current administration wants to support domestic provision of key metals and minerals, including copper. That's excellent news for Freeport-McMoRan (FCX +1.71%), which calls itself "America's Copper Champion." Here's why the stock is a great buy right now.
Why copper matters
Copper is critical to the modern economy. It's a crucial element in the electrification-of-everything trend, which encompasses electric vehicles, the Internet of Everything, renewable energy, data centers, and the electrical transmission and distribution networks needed to support the growing electrification of the economy.
Whatever the tariff landscape ends up looking like, the Trump administration is likely to support the domestic production of copper, and Freeport-McMoran will play a key role.
NYSE: FCX
Key Data Points
America's Copper Champion
The point isn't lost on Freeport's management, and it took the time to highlight its role as the key player in domestic production -- the miner supplies 70% of domestically sourced copper for U.S. refining. So if there's a hefty premium attached to the U.S. price of copper compared to the international price, Freeport will benefit.
That's precisely what's happened in 2025, as traders have bid up the U.S. price of copper relative to the international price (traded on the London Metal Exchange) in expectation of potential tariffs on copper. Indeed, Freeport's CEO, Kathleen Quirk, noted that the premium at the time of the earnings release in late April "implies an approximate $800 million bottom line annual financial benefit on Freeport's U.S. copper sales."
Leaching initiatives and expansion projects
Moreover, the idea of Freeport being America's copper champion is supported by two other reasons. First, it has a low-cost leaching initiative to recover copper from existing stockpiles in the U.S., with which it can significantly improve copper production and sales without expanding an existing mining operation.
To put the leaching initiative into context, Freeport expects to sell 4 billion pounds of copper in 2025 (with 35% currently produced in the U.S.) , and the leaching initiative is expected to hit a run rate of about 200 million pounds by the end of the year, rising to between 300 million and 400 million pounds by the end of 2026 and then 800 million pounds by the end of 2030.
These are highly significant figures considering Freeport's total copper production for 2025 and the 307 million pounds produced in the U.S. in the first quarter.
Image source: Getty Images.
The second reason is that Freeport already has substantive brownfield (implying they won't need substantive infrastructure built around them) expansion projects in the U.S. in its pipeline, specifically in Bagdad and Safford in Arizona.
While expansion projects take time and will require investment, management believes it has the long-term potential to increase copper production by 2.5 billion pounds over time, with 47% of that figure coming from the U.S. and the rest from Indonesia and Chile.
Potential benefits
Freeport will also benefit if copper is made eligible for existing Section 45x tax credits (providing for a credit equivalent to 10% of production costs in the U.S.). That would encourage new investment and production in the U.S., and the U.S. Chamber of Commerce is advocating for it.
Image source: Getty Images.
A stock to buy?
While there's still uncertainty over the direction of the global economy (copper is a metal highly sensitive to growth) and ultimately the price of copper, the stock's valuation is highly attractive. For example, management estimates it will generate $11 billion in earnings before interest, taxation, depreciation, and amortization (EBITDA) in 2026/2027 with a copper price of $4 per pound and $15 billion with a copper price of $5 per pound.
Plugging in the current price of $4.66 produces a back-of-the-envelope figure of $13.6 billion compared to the current market capitalization of $56.6 billion and enterprise value (market cap plus net debt) of $61.71 billion. That looks cheap for a company helping the U.S. secure a metal essential to the modern economy.
