The Country Caller looks at the major developments that are in favor of the $20.86 billion company

Published By: Myrna Salomon on January 11, 2017 08:26 am EST

Copper producer Freeport-McMoRan Inc (NYSE:FCX) has been one of the best performing stocks in the energy sector lately. The Phoenix-based company has had very little to do with suppressed oil prices lately, as its major product is copper. Given the fact that the outlook for copper is brighter in 2017, the odds of the company’s share price hitting a new 52-week high levels are high. The Country Caller looks at the major developments that are in favor of the $20.86 billion company.

A correction seems to be continuing in the market for copper while that merely seems to be a profit taking scenario. The copper market is undergoing a supply deficit much earlier than expected, which is a positive sign for the bulls. As the demand overtakes supply further in the future, an upward trend in the commodity’s prices shall be seen. Apart from copper, favorable conditions in the international markets are also a positive sign. Major oil producing nations have already initiated supply cuts which is a plus point for the commodity’s future.

As far as the capital markets are concerned, a glance at the options market hints that there is an increasing interest in call options worth close to $15, while not much activity can be seen in the put contracts. Short interest has also recently decreased by 11% which is another positive development.

A rise in confidence by sell-side firm Jefferies Group is also a vital factor that encourages investors to take positions in the company’s stock. The consensus price target seems a bit depressing, but it is important to note that not many research firms have updated their views lately.

The before market trading activity hints a positive sentiment in the market as shares of Freeport-McMoRan are trading higher at $15.60 as at 3:53 AM EDT