Freeport-McMoRan (FCX), a major player in the global copper market, is gaining increased attention from investors following a bullish forecast on copper prices and a subsequent stock upgrade by Bank of America (BofA). With copper’s indispensable role in various sectors like construction and renewable energy, the demand for this red metal is rising sharply, particularly from Chinese manufacturers amid global supply constraints.
Earlier this month, Bank of America enhanced its copper price forecast to $10,250 per ton by the fourth quarter of 2024, an 8% increase from previous estimates, and projected further growth to $12,000 per ton by 2026. This optimistic outlook is based on tightening supply and accelerating demand, positioning copper at the center of significant market movements.
In light of these developments, BofA upgraded Freeport-McMoRan from “Neutral” to “Buy,” highlighting the company’s robust copper leverage and increasing free cash flow, further enhanced by substantial gold revenue. Freeport-McMoRan, headquartered in Phoenix, Arizona, operates key mining locations across North America, South America, and Indonesia, focusing on not just copper but also gold, molybdenum, and other metals.
Freeport-McMoRan has shown a promising trajectory with a 16% year-to-date stock surge, outperforming the S&P 500. The company offers a dividend yield of 1.20% with a forward earnings multiple that stands competitive within the industry. Its fourth-quarter earnings beat expectations, driven by high copper and gold demand, setting a positive tone for its upcoming Q1 report on April 23.
Analysts remain optimistic, with a consensus “Moderate Buy” rating on FCX stock. With expansion projects underway in the U.S. and an expected increase in metal production in 2024, Freeport-McMoRan is strategically positioned to capitalize on the projected rise in copper prices. This makes FCX a compelling consideration for investors looking at dividend-paying stocks in a sector poised for growth. 
