Gold Price Analysis – Where Is Freeport-McMoRan Stock Headed After Dropping 8% In A Week? — Trefis
Freeport-McMoRan stock (NYSE: FCX) dropped more than 8% in one week (five trading days) and has, in fact, underperformed the S&P 500 which increased 1% during this period. FCX stock now trades at $32. FCX stock generally trades in line with the global copper prices. However, this trend seems to have broken over recent weeks, as the stock has declined despite copper prices having remained strong. But over enthusiasm of the market with respect to FCX stock since the beginning of 2021 and decline in gold prices over recent weeks have led to a drop in FCX stock recently. Gold prices have declined 13% since the beginning of 2021, from $1,950/ounce in January 2021 to $1,704/ounce on 29th March 2021. In the last one week, gold prices have declined almost 1%. The drop in gold prices has been driven by expectations of faster economic recovery and likelihood of higher interest rates in the coming quarters, which has reduced the investment value of the yellow metal. With gold contributing almost 10% to FCX’s revenues, volatility in its price has taken a toll on the company’s stock.
But, is FCX stock set to continue its downward trajectory or could we expect some uptick? We believe that there is a 53% chance of a rise in FCX stock over the next month (twenty-one trading days) based on our machine learning analysis of trends in the stock price over the last ten years. See our analysis on FCX Stock Chances Of Rise for more details.
Five Days: FCX -8.3%, vs. S&P500 0.9%; Underperformed market
(10% likelihood event)
- Freeport stock declined 8.3% over a five-day trading period ending 3/29/2021, compared to broader market (S&P500) rise of 0.9%
- A change of -8.3% or more over five trading days is a 10% likelihood event, which has occurred 241 times out of 2516 in the last ten years
Ten Days: FCX -13%, vs. S&P500 0.2%; Underperformed market
(34% likelihood event)
- Freeport stock declined 13% over the last ten trading days (two weeks), compared to broader market (S&P500) rise of 0.2%
- A change of -13% or more over ten trading days is a 34% likelihood event, which has occurred 850 times out of 2500 in the last ten years
Twenty-One Days: FCX -5.3%, vs. S&P500 4.3%; Underperformed market
(15% likelihood event)
- Freeport stock declined 5.3% the last 21 trading days (one month), compared to a broader market (S&P500) rise of 4.3%
- A change of -5.3% or more over 21 trading days is a 15% likelihood event, which has occurred 370 times out of 2458 in the last ten years
While FCX stock may have moved, 2020 has created many pricing discontinuities which can offer attractive trading opportunities. For example, you’ll be surprised how how the stock valuation for Compass Minerals vs Southwest Gas shows a disconnect with their relative operational growth. You can find many such discontinuous pairs here.
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