Freeport-McMoRan Inc (NYSE:FCX) was reviewed by FBR Capital analyst Lucas Pipes following the announcement that Indonesia government would temporarily allow export of copper concentrates. Despite the good news, the analyst remained sidelined and maintained his Perform rating on the shares. The analyst also reiterated a price target of $13 on FCX stock, indicating about 4% downside from the current levels. Nonetheless, the stock traded in green yesterday and was up 2.27% during active trading.
According to Mr. Pipes, the Indonesian government has agreed to provide Freeport-McMoRan with a temporary license to resume its exports. The analyst believes that the announcement represents a significant positive development in the recent disputes and implies that the issue might be de-escalating. The analyst noted that the export license is expected to have a term of eight months. This is likely to further positively impact Arizona-based company shares, which have already climbed 2.65% since the beginning of the year. Also, the stock gained more than 36% during the last 12 months.
Bloomberg report suggests that the $19.39 billion business is likely to resume copper concentrates exports from the second-largest copper mine globally after a gap of 12 weeks. Meanwhile, the government plans to continue its talks with the company on a longer term financial stability agreement. In this regard, the company’s spokesman, Eric Kinneberg stated, “We are progressing constructive discussions with the government that would enable PT-FI to resume concentrate exports while retaining our contract until a mutually satisfactory replacement agreement is completed.”
In contrast, Wall Street analysts have maintained consensus price target at $14.4, implying 6.35% upside potential over Tuesday’s closing price. Of the total 23 analysts covering the stock at the Street, three rated Freeport-McMoRan as Buy, 18 analysts recommended Hold, while one analyst each provided with Underweight and Sell recommendations.