Bank of America upgraded Freeport-McMoRan to Buy from Neutral, while keeping its price objective at $42 per share, about 13% above the last close.
The bank’s analysts said the miner’s valuation already captures the main uncertainties around the Grasberg mine disruption.
Analysts said they spoke with President and CEO Kathleen Quirk and “came away increasingly confident that our $42 per share valuation sufficiently prices the key risks around its temporarily halted Grasberg copper/gold mine in Indonesia.”
Their initial estimate of $0.5 billion in capex for repairs may prove conservative, but that the restart timeline outlined on September 24 “appears reasonable,” a team led by Lawson Winder said.
The Grasberg Block Cave accounts for 50% of Freeport’s reserves and 70% of previously forecast copper and gold output through 2029. Production guidance for Q3 2025, Q4 2025, and 2026 was cut by 1.1 billion pounds of copper, reflecting the scale of the incident.
The disruption at Grasberg further exacerbates global copper supply risks. BofA noted similar setbacks at El Teniente and Kamoa-Kakula, ongoing ramp-up issues at Quebrada Blanca II, and the prolonged stoppage at Cobre Panama.
The bank’s metals team now sees the copper deficit widening to 350kt in 2026 and 533kt in 2027, compared with just 25kt in 2025.
Other Indonesian mines are expected to restart by late 2025, with a phased Grasberg ramp-up in the first half of 2026.
Valuation remains a key support. Freeport trades at 6.3 times 2026 estimated EBITDA versus a peer average of 8.6 times, which BofA called attractive.
The bank also flagged a bullish copper outlook, projecting prices of $13,500 per tonne in 2027, about 30% above current levels.
Source :
https://www.investing.com/news/stock-market-news/bofa-upgrades-freeportmcmoran-to-buy-says-key-risks-are-priced-4263427
