We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Will Lower Copper Prices Dent Freeport's (FCX) Q1 Earnings?
Read MoreHide Full Article
Freeport-McMoRan Inc. (FCX - Free Report) is set to release first-quarter 2020 results on Apr 24, before the opening bell.
The company has a trailing four-quarter positive earnings surprise of 20.6%, on average. The temporary halt of normal operations at the Cerro Verde mine and weak copper prices likely are to have affected the company’s first-quarter performance.
The stock has lost 45.7% in the past year compared with the industry’s 35.3% decline.
Let’s see how things are shaping up for the upcoming announcement.
What to Expect?
In March, Freeport issued an operational update and stated that production from the Grasberg Block Cave and Deep MLZ orebodies averaged nearly 35,000 metric tons of ore per day from Jan 1 through Mar 5.
However, the company stated last month that it is revising operating plans amid the coronavirus pandemic. This might lead to a temporary reduction in copper and molybdenum production in the Americas, which are witnessing low commodity prices.
Moreover, Freeport has 53.56% interest in Cerro Verde, which operates one of the largest concentrating facilities near Arequipa, Peru. Cerro Verde was transitioned provisionally to a care and maintenance status for a 15-day period starting Mar 16. Further, the government of Peru has extended the declaration of National Emergency till Apr 26, 2020. The halt of normal operations at Cerro Verde might have partly impacted the company’s production in the first quarter.
Other Factors At Play in Q1
Weaker copper prices are likely to have weighed on Freeport’s first-quarter results. Copper prices tumbled to a three-year low in March thanks to impact of the coronavirus outbreak on the global economy and a sharp decline in crude oil prices. Concerns over a slowdown in demand in China, the world’s biggest metal consumer, also hurt prices. Industrial production in China took a big hit partly due to coronavirus-induced shutdowns and quarantine restrictions. Prices of the red metal were under pressure last month as the pandemic hurt industrial activities.
What do the Estimates Indicate?
The Zacks Consensus Estimate for Freeport’s first-quarter consolidated revenues is currently pegged at $2,973 million, which suggests a year-over-year decline of 21.6%.
The Zacks Consensus Estimate for first-quarter consolidated net cash costs per pound of copper is currently pegged at $1.99, which suggests a 11.8% rise on a year-over-year basis. The same for average realized price for copper stands at $2.78 per pound, which calls for a 4.1% decline year over year.
The consensus mark for consolidated copper sales for the first quarter is pegged at 726 million pounds, which calls for a rise of 17.9% year over year and a sequential fall of 19.9%.
Our proven model doesn’t predict an earnings beat for Freeport this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for Freeport is 0.00%. The Most Accurate Estimate and the Zacks Consensus Estimate are both currently pegged at a loss of 23 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Freeport currently carries a Zacks Rank #3.
Stocks Likely to Beat Estimates
Here are some companies that you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:
Yamana Gold Inc. , slated to release first-quarter 2020 earnings on Apr 30, has an Earnings ESP of +12.50% and carries a Zacks Rank #3.
Wheaton Precious Metals Corp. (WPM - Free Report) , scheduled to release first-quarter 2020 results on May 6, has an Earnings ESP of +4.24% and carries a Zacks Rank #3.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Image: Bigstock
Will Lower Copper Prices Dent Freeport's (FCX) Q1 Earnings?
Freeport-McMoRan Inc. (FCX - Free Report) is set to release first-quarter 2020 results on Apr 24, before the opening bell.
The company has a trailing four-quarter positive earnings surprise of 20.6%, on average. The temporary halt of normal operations at the Cerro Verde mine and weak copper prices likely are to have affected the company’s first-quarter performance.
The stock has lost 45.7% in the past year compared with the industry’s 35.3% decline.
Let’s see how things are shaping up for the upcoming announcement.
What to Expect?
In March, Freeport issued an operational update and stated that production from the Grasberg Block Cave and Deep MLZ orebodies averaged nearly 35,000 metric tons of ore per day from Jan 1 through Mar 5.
However, the company stated last month that it is revising operating plans amid the coronavirus pandemic. This might lead to a temporary reduction in copper and molybdenum production in the Americas, which are witnessing low commodity prices.
Moreover, Freeport has 53.56% interest in Cerro Verde, which operates one of the largest concentrating facilities near Arequipa, Peru. Cerro Verde was transitioned provisionally to a care and maintenance status for a 15-day period starting Mar 16. Further, the government of Peru has extended the declaration of National Emergency till Apr 26, 2020. The halt of normal operations at Cerro Verde might have partly impacted the company’s production in the first quarter.
Other Factors At Play in Q1
Weaker copper prices are likely to have weighed on Freeport’s first-quarter results. Copper prices tumbled to a three-year low in March thanks to impact of the coronavirus outbreak on the global economy and a sharp decline in crude oil prices. Concerns over a slowdown in demand in China, the world’s biggest metal consumer, also hurt prices. Industrial production in China took a big hit partly due to coronavirus-induced shutdowns and quarantine restrictions. Prices of the red metal were under pressure last month as the pandemic hurt industrial activities.
What do the Estimates Indicate?
The Zacks Consensus Estimate for Freeport’s first-quarter consolidated revenues is currently pegged at $2,973 million, which suggests a year-over-year decline of 21.6%.
The Zacks Consensus Estimate for first-quarter consolidated net cash costs per pound of copper is currently pegged at $1.99, which suggests a 11.8% rise on a year-over-year basis. The same for average realized price for copper stands at $2.78 per pound, which calls for a 4.1% decline year over year.
The consensus mark for consolidated copper sales for the first quarter is pegged at 726 million pounds, which calls for a rise of 17.9% year over year and a sequential fall of 19.9%.
Freeport-McMoRan Inc. Price and EPS Surprise
Freeport-McMoRan Inc. price-eps-surprise | Freeport-McMoRan Inc. Quote
What Does the Zacks Model Say?
Our proven model doesn’t predict an earnings beat for Freeport this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for Freeport is 0.00%. The Most Accurate Estimate and the Zacks Consensus Estimate are both currently pegged at a loss of 23 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Freeport currently carries a Zacks Rank #3.
Stocks Likely to Beat Estimates
Here are some companies that you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:
Franco-Nevada Corporation (FNV - Free Report) , scheduled to release first-quarter 2020 earnings on May 6, has an Earnings ESP of +0.32% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Yamana Gold Inc. , slated to release first-quarter 2020 earnings on Apr 30, has an Earnings ESP of +12.50% and carries a Zacks Rank #3.
Wheaton Precious Metals Corp. (WPM - Free Report) , scheduled to release first-quarter 2020 results on May 6, has an Earnings ESP of +4.24% and carries a Zacks Rank #3.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>