| Stable Energy Prices in May Bode Well for Freeport-McMoRan | |
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What's Driving Freeport and Other Copper Producers in 2015? (Continued from Prior Part) Crude oil at $60 in May
Previously in this series, we looked at some indicators of the copper industry. In this part, we’ll take a look at Freeport-McMoRan (FCX), one of the top two copper producers. We’ll also analyze recent movements in crude oil prices.
On May 29, WTI (West Texas Intermediate) was trading at $60.30 per barrel. Freeport has significant investments in oil and gas assets, so Freeport investors should keep a close eye on crude oil prices.
Crude oil prices stabilize
The above graph shows recent movements in WTI prices. Prices traded largely sideways in May, flirting around the $60 level. This was preceded by a 25% rise in April. Crude oil prices reached multi-year lows earlier in March but bounced back sharply after that.
Energy exploration companies (XOP) like ConocoPhillips (COP) and Suncor Energy (SU) benefit from the increase in crude oil prices. COP and SU form 4.36% and 2.33%, respectively, of the iShares North American Natural Resources ETF (IGE).
Higher energy prices boost Freeport’s earnings. Earlier this year, the company had to slash its dividend by more than 80% as both energy and copper prices tumbled.
IPO of energy business?
In its 1Q15 earnings conference call, Freeport highlighted that it might consider selling a minority stake in its energy business. It might come out with an IPO (initial public offering) of its oil and gas subsidiary later this year, subject to market conditions and regulatory approvals. Higher energy prices would help Freeport price the IPO at a better price.
Freeport gets more than 10% of its revenue from gold. It produces gold from its mine in Indonesia. In the next part, we’ll look at some of the recent trends in gold prices.
Continue to Next Part Browse this series on Market Realist:
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Freeport McMoRan Copper and Gold Inc.
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PRODUCER |
CODE : FCX |
ISIN : US35671D8570 |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
Freeport McMoran is a gold and copper producing company based in United states of america. Freeport McMoran produces gold, copper, cobalt, molybdenum and silver in Chile, in Congo Dem. Rep. of, in Indonesia and in Peru, develops copper in Peru, and holds various exploration projects in Chile. Its main assets in production are CANDELARIA, EL ABRA, CHINO - MILL, HENDERSON, MIAMI - ROM LEACH, MORENCI - MILL, OJOS DEL SALADO, MORENCI and MORENCI - ROM LEACH in Chile, GRASBERG, SIERRITA and BAGDAD in Indonesia, TENKE FUNGURUME and TYRONE in Congo Dem. Rep. of and CERRO VERDE in Peru, its main asset in development is SAFFORD in Peru and its main exploration properties are BAGDAD - ROM LEACH and CHINO - ROM LEACH in Peru and CERRO VERDE - MILL, CERRO VERDE - CRUSHED LEACH, CERRO VERDE - ROM LEACH, EL ABRA - ROM LEACH and CLIMAX in Chile. Freeport McMoran is listed in Germany and in United States of America. Its market capitalisation is US$ 72.9 billions as of today (€ 68.1 billions). Its stock quote reached its lowest recent point on March 06, 2020 at US$ 10.00, and its highest recent level on April 26, 2024 at US$ 50.37. Freeport McMoran has 1 448 000 000 shares outstanding. |