Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, global mining giant Freeport-McMoRan Copper & Gold
With that in mind, let's take a closer look at Freeport's business and see what CAPS investors are saying about the stock right now.
|Headquarters (Founded)||Phoenix (1987)|
|Market Cap||$28.3 billion|
|Industry||Diversified metals and mining|
|Trailing-12-Month Revenue||$22.28 billion|
CEO Richard Adkerson
CFO Kathleen Quirk
|Return on Capital (Average, Past 3 Years)||25.1%|
|Cash/Debt||$4.38 billion / $3.54 billion|
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 97% of the 5,755 members who have rated Freeport believe the stock will outperform the S&P 500 going forward. These bulls include JohnnySp and All-Star TSIF, who is ranked in the top 0.1% of our community.
A couple of months ago, JohnnySp touched on Freeport's cheapish price ratios: "Low PEG, respectable P/B value, and a great EV/FCF. ... FCX has a hand in three precious metals, gold, silver, and molybdenum. ... Plus, a nice dividend doesn't hurt!"
In fact, Freeport currently sports a particularly paltry P/E of 5.1. That's lower than that of competitors like BHP (7.6), Newmont (14.1), and Southern Copper (10.2).
CAPS All-Star TSIF elaborates on the bargain opportunity:
The recent selldown of Copper, Gold, and Silver as investors/speculators determine their risk/reward metals/cash ratio is only a portion of the selldown. Freeport-McMoRan has other temporary issues burdening investors appetite. ...
Overall Freeport-McMoRan will clearly find a solution that keeps them profitable and the cost basis of most of their mines is well below norm. While Freeport may not bounce back to recent highs the gap down to the sub $32 price range should at least partially fill and the 3% dividend should be secure. Freeport's gold, copper, silver mix will allow it to weather any further declines in the price of copper even with gold/silver prices nearer "norms".
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