Copper producing giant Freeport-McMoRan Copper & Gold Inc. (
) saw its earnings estimates lowered on Wendesday by analysts at
The firm maintained its "Hold" rating on FCX, but lowered its
estimates for the company due to weakening copper prices. Deutsche
Bank noted that "as copper goes, so do earnings."
The analyst commented, "We now look for 2Q10 EPS of US$1.31, 28%
lower than prior estimates of US$1.81 and 34% lower QoQ. Revised
2Q10 EPS now 17% below Bloomberg consensus of US$1.59. While FCX
share price has entered attractive territory, we are concerned that
near-term earnings weakness could impede sustained rally and await
Freeport-McMoRan shares rose $1.27, or +2.1%, in premarket
The Bottom Line
We had removed shares of FCX from our recommended list last Sept.
2, when the stock was trading at $89.32. The company has a .98%
dividend yield, based on last night's closing stock price of
$61.48.The stock has technical support in the $55-$56 price area.
If the shares can firm up, we see overhead resistance around the
$65-$67 price levels. We would remain on the sidelines for now.
Freeport-McMoRan Copper & Gold Inc. (
) is not recommended at this time, holding a Dividend.com DARS™
Rating of 3.2 out of 5 stars.
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