FCX Slips Below 200-Day SMA: What Should Investors Do Now?

Freeport-McMoRan Inc.’s FCX stock slipped below the 200-day simple moving average (SMA) last Friday, flashing a bearish signal. While FCX’s third-quarter results showed a rise in both top and bottom line on higher copper and gold prices, its guidance indicates higher expected unit costs and weaker copper and gold sales volumes. 

FCX has been trading below the 50-day SMA since Oct. 14, 2025. Nevertheless, following a golden crossover on July 8, 2025, the 50-day SMA is reading higher than the 200-day SMA, indicating a bullish trend.

FCX Stock Trades Below 200-Day SMA

Freeport’s shares have lost 5.3% in the past month. It has outperformed the Zacks Mining - Non Ferrous industry’s decline of 8.6% while underperforming the S&P 500’s fall of 1.2% over the same period. Its peers, Southern Copper Corporation SCCO and BHP Group Limited BHP, have lost 8.3% and 5.5%, respectively, in the same time.

Freeport’s One-month Price Performance

Let’s take a look at FCX’s fundamentals to analyze the stock better.

Freeport’s Growth Actions to Drive Capacity & Production

Freeport is well-placed with high-quality copper assets and remains focused on strong execution and advancing its organic growth opportunities. At its Cerro Verde operation in Peru, a large-scale concentrator expansion provided incremental annual production of around 600 million pounds of copper and 15 million pounds of molybdenum. It has completed the evaluation of a large-scale expansion at El Abra in Chile to define a large sulfide resource that could potentially support a major mill project similar to the large-scale concentrator at Cerro Verde, with an estimated resource approximating 20 billion recoverable pounds of copper. 

FCX is also conducting pre-feasibility studies (expected to be completed in 2026) in the Safford/Lone Star operations in Arizona to define a significant sulfide expansion opportunity. It also has expansion opportunities at Bagdad in Arizona to more than double the concentrator capacity of the operation. 

Also, PT Freeport Indonesia (PT-FI) substantially completed the construction of the new greenfield smelter in Eastern Java during 2024, with start-up having commenced in second-quarter 2025. The first production of copper anode was achieved in July 2025. PT-FI is also developing the Kucing Liar ore body within the Grasberg district with a targeted ramp-up to commence before 2030. Gold production also started at the new precious metals refinery in late 2024. Plans are in place to transition PT-FI’s existing energy source from coal to natural gas, which is expected to significantly reduce greenhouse gas emissions at Grasberg.

FCX’s Solid Financial Health & Capital Discipline Bode Well

FCX has a strong liquidity position and generates substantial cash flows, which allow it to finance its growth projects, pay down debt and drive shareholder value. It generated operating cash flows of around $1.7 billion in the third quarter of 2025. Freeport ended the third quarter with strong liquidity, including $4.3 billion in cash and cash equivalents, $3 billion in availability under the FCX revolving credit facility, and $1.5 billion in availability under the PT-FI credit facility.

At the end of the third quarter, Freeport had a net debt of $1.7 billion, excluding PTFI’s new downstream processing facilities. Its net debt is below its targeted range of $3-$4 billion. Freeport has a policy of distributing 50% of the available cash to shareholders and the balance to either reduce debt or invest in growth projects. FCX has no significant debt maturities until 2027. Its long-term debt-to-capitalization is around 22.7% compared with 39.1% for Southern Copper and 29.3% for BHP Group.

FCX offers a dividend yield of roughly 0.8% at the current stock price. Its payout ratio is 19% (a ratio below 60% is a good indicator that the dividend will be sustainable), with a five-year annualized dividend growth rate of about 12.9%. Backed by strong financial health, the company's dividend is perceived to be safe and reliable.

Favorable Copper Prices Augur Well for FCX

Copper prices remained volatile this year amid global economic and trade uncertainties. After racking up solid gains in late March, copper prices slipped to around $4.1 per pound in early April amid demand worries due to tariffs, which threatened to cause a broader slowdown globally. However, prices of the red metal moved up in late April to roughly $4.9 per pound amid a weakening U.S. dollar on heightened concerns about the prospect of a downturn in the U.S. economy. 

Prices again retreated to around $4.7 per pound in late May on weak global demand and increased supply. In June, prices recovered to close the second quarter above the $5 per pound level. Volatility continued in the third quarter, with prices hitting an all-time high of around $5.96 per pound in July before slipping again to close the month at around $4.4 per pound. Copper prices mostly hovered around $4.5 per pound in August, while climbing around the end of September to close the third quarter near $5 per pound on supply worries. Prices, for the most part, have remained above $5 per pound in the fourth quarter.

Freeport’s average realized copper price climbed nearly 9% year over year to $4.68 per pound in the third quarter, driving its top and bottom lines. Favorable prices are expected to continue to support its performance.

Higher Unit Costs May Weigh on Freeport’s Margins

FCX saw an increase in its average unit net cash cost per pound of copper in the third quarter of 2025 to $1.40 from $1.13 in the prior quarter, marking a roughly 24% spike. The increase was fueled by a decline in copper sales volumes.  

Freeport's outlook for the fourth quarter suggests significantly higher costs on a sequential basis. It expects unit net cash costs to rise to $2.47 per pound, while projecting a full-year average of roughly $1.68. Lower expected sales volumes are likely to impact costs in the quarter. Higher costs are likely to weigh on the company's margins.

Lower Expected Volumes A Drag on FCX’s Prospects

Freeport’s copper sales volumes fell approximately 6% year over year in the third quarter to 977 million pounds. The downside primarily resulted from the temporary suspension of operations since the mud rush incident at the Grasberg Block Cave mine in Indonesia in September 2025, which led to the suspension of operations. The company sold 336,000 ounces of gold, down around 40% year over year.

Freeport’s copper sales volume outlook for the fourth quarter assumes minimal contribution from the Indonesia operation due to the Grasberg mine incident. FCX expects copper sales volumes of 635 million pounds, indicating a 35% sequential and 36% year-over-year decline. The company has also provided a weaker gold sales volume guidance of 60,000 ounces, reflecting significant sequential and year-over-year decreases. Lower sales volumes are expected to weigh on its top line in the fourth quarter. FCX is preparing for a phased restart and ramp-up of the Grasberg Block Cave underground mine, starting in the second quarter of 2026.

FCX’s Earnings Estimates Going Down

Freeport’s earnings estimates have been going down over the past 60 days. The Zacks Consensus Estimate for 2025 and 2026 has been revised down over the same time frame.

A Look at FCX’s Valuation

FCX is currently trading at a forward price/earnings of 21.34X, a roughly 5.1% premium to the industry average of 20.3X. The FCX stock is trading at a discount to Southern Copper and a premium to BHP Group.

FCX’s P/E F12M Vs. Industry, SCCO and BHP

Final Thoughts: Hold FCX Stock for Now

FCX is poised to gain from progress in expansion activities that will boost production capacity. Robust financial health allows FCX to invest in growth projects and drive shareholder value. Supportive copper prices and healthy dividend growth are the other positives. Despite these positives, a weaker sales volume outlook and higher expected unit costs warrant caution. Holding onto this Zacks Rank #3 (Hold) stock will be prudent for investors who already own it.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research