This remains a compelling value at current trading levels, and copper pricing has been on fire. Freeport-McMoRan Inc. (NYSE: FCX) is the world’s largest publicly traded copper and molybdenum producer, and the eighth largest gold producer. Its key operating and development assets are in Indonesia, North and South America and Africa.
Highly leveraged toward copper mining, the company could be a big player in a scenario of rebuilding and repairing old and battered projects and would clearly benefit from stronger demand and higher prices for industrial commodities.
In November, PT Freeport Indonesia and Mitsubishi Materials signed a memorandum of understanding to expand the Gresik copper smelter and refinery. The expansion is projected to increase capacity by 300,000 tons per year, bringing total capacity to 1.3 million tons per year. Construction is expected to be completed in 2023, with financing of $250 million provided by PT-FI.
Jefferies has been bullish on the company and the sector for some time, and the research report said this:
We believe copper will benefit from secular demand drivers (EVs and renewable energy) as well as a cyclical recovery in demand ex-China starting this year. These demand drivers will more than offset a policy-driven slowdown in Chinese demand as tightening measures begin to impact some Chinese end markets, such as housing. As a result, we believe that the copper market has shifted into a multi-year deficit that will eventually be resolved by increased scrap supply, substitution, demand destruction and new mine capacity – all of which will be in response to higher prices.
Jefferies has set its price target at $35. The lower consensus target is $25.81, and Freeport-McMoRan stock closed at $31.15 on Friday.
This was ranked as one of the top five defense contractors by sales last year. Northrop Grumman Corp. (NYSE: NOC) provides innovative systems, products and solutions in unmanned systems, cyber, C4ISR and logistics and modernization to government and commercial customers worldwide. It was also one of the companies profiting most from war.
The Aerospace Systems segment designs, develops, integrates and produces manned aircraft, unmanned systems, spacecraft, high-energy laser systems, microelectronics and other systems and subsystems.
The Information Systems segment offers advanced solutions for the Department of Defense, national intelligence and federal civilian, state, international and commercial customers. It provides products and services primarily in the fields of command and control, communications, cyber, air and missile defense, intelligence processing, civil security, health information technology, and government support systems.
The Technical Services segment provides logistics, modernization and sustainment services, as well as other advanced technology and engineering services, including space, missile defense, nuclear security, training and simulation services.
Shareholders receive a 1.92% dividend. The Jefferies price objective is $375. The consensus price target is $378.83. Northrop Grumman stock ended last week at $288.33 a share.
These four top stocks for growth investors could be massive long-term winners. Again, after a huge rally that has put all the major indexes and the Russell 2000 at all-time highs, caution is clearly warranted here. It may be smart to buy partial positions, as fourth-quarter earnings season is right around the corner.