Revisiting My Freeport McMoran (FCX) Call

August 4, 2008 at 12:47 pm  ·  Category: Stocks

The stock has run, but nothing unusual.  It barely made a 52 week high with copper prices at all time highs and the company is executing.  The stock is undervalued.

slim1216, comment on SeekingAlpha, April 24, 2008

This is the time to get on board, not jump ship.

stephen rosenman, comment on SeekingAlpha, April 24, 2008

FCX is undervalued here simply on copper valuations….. We might take some short-term licks since most, like you, fail to truly grasp the situation.  But the stock will continue to vastly outperform the market…

auminer, comment on SeekingAlpha, April 25, 2008

Wow, that certainly is one contrarian view you got going there….. If your short is to find a few bucks, yeah, that can happen, but if you looking for a big down side move, then I think you are in for some pain.

redrum, comment on SeekingAlpha, April 26, 2008

On April 23, 2008 I wrote a post titled “Freeport Valuation Bloated Here”:

I think there’s a very thin margin of error here and if copper prices come down, Freeport will get hammered.

It’s had a great run but I can’t help thinking it has to come to an end.

At the time I wrote the post, Freeport was at $118.  Interestingly, of the 8 commenters on the post at SeekingAlpha, every single one of them was skeptical and critical of my call.

Today, 3 1/2 months later, Freeport is getting crushed on heavy volume down to around $80 – a 32% drop in the 3 1/2 months since I put up the post (FCX 6 Month Chart). 

I covered our short position today.

Disclosure: Top Gun has no position in Freeport McMoran (FCX) shares.

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