BofA Securities Downgrades Freeport-McMoRan (FCX) to Neutral, 'Grasberg operational challenges a material overhang'

BofA Securities analyst Lawson Winder downgraded Freeport-McMoRan (NYSE: FCX) from Buy to Neutral with a price target of $42.00 (from $50.00).

The analyst comments "Freeport-McMoRan (FCX) provided an update on the previously reported mud rush incident at the Grasberg mine in Indonesia, which occurred on 8-Sep-25. Tragically, as reported on 20-Sep-25, there are two confirmed fatalities, and five people remain missing. FCX has commenced an investigation, to identify the cause of this incident, that is to be completed by year-end 2025. FCX is instituting a force majeure. Grasberg production guidance for Q3’25, Q4’25 and 2026 are being reduced materially. The impacted area, the Grasberg Block Cave (GBC), accounts for 50% of reserves and 70% of previously forecast copper (Cu) and gold (Au) production through 2029 at the mine. Grasberg, in turn, accounts for 28% of our net asset value (NAV) for FCX and 47% of our forecasted free cash flow through 2029E. We cut our 2025E and 2026E estimates and hence reduce our price objective (PO) based on 8.0x 2025E, 7.5x 2026E EV/EBITDA and 1.0x NAV (methodology unchanged) by 16% to $42 per share. We downgrade FCX from Buy to Neutral. We see the operational challenges at Grasberg as an overhang to at least early 2026. This is balanced by our bullish copper view, now further supported by reduced Grasberg production (cumulatively about 2% of global annual mined production."

For an analyst ratings summary and ratings history on Freeport-McMoRan click here. For more ratings news on Freeport-McMoRan click here.

Shares of Freeport-McMoRan closed at $45.36 yesterday.

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