Freeport McMoRan (FCX) Net Margin Improvement Tests Premium P/E And Undervaluation Narrative
Freeport-McMoRan (FCX) has wrapped up FY 2025 with Q4 revenue of US£5,633 million and basic EPS of US£0.28, rounding out a trailing twelve month profile that includes US£25.9 billion in revenue and EPS of US£1.53. Over the past year, the company has seen quarterly revenue move between US£5,633 million and US£7,582 million, while basic EPS has ranged from US£0.24 to US£0.53. This gives investors a clearer view of how earnings tracked through the cycle.
With a trailing net profit margin of 8.5% versus 7.4% in the prior year and earnings growth forecasts outpacing revenue, the latest print sets up a results season in which profitability quality is front and center for investors.
See our full analysis for Freeport-McMoRan.[1]With the raw numbers on the table, the next step is to see how this earnings story lines up against the widely followed narratives around Freeport-McMoRan's growth prospects, risks, and valuation signals. Curious how numbers become stories that shape markets? Explore Community Narratives[2]
NYSE:FCX Earnings & Revenue History as at Jan 2026
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Margins Steady With 8.5% Net Profit
- Over the last 12 months, Freeport-McMoRan generated US£25.9b in revenue and US£2.2b in net income, which works out to an 8.5% net profit margin compared with 7.4% in the prior year.
- What stands out for a bullish take is that trailing earnings rose about 17%, while the five year compound earnings change was roughly an 11.2% decline each year, so:
- Recent profit of US£2.2b versus the weaker five year pattern supports the view that the business is currently operating above its longer term average earnings run rate.
- This faster recent growth, alongside a margin of 8.5%, gives bulls some concrete evidence that the latest 12 month performance looks stronger than the longer multi year track record.
Premium 38.3x P/E Versus Peers
- The shares trade on a P/E of 38.3x, compared with about 27.8x for the broader US Metals & Mining group and 28x for peers, so the stock changes hands at a higher multiple than the sector while trailing net income sits at US£2.2b.
- Bears argue that this premium multiple leaves little room for disappointment, and the recent history gives them some figures to point to:
- Earnings are forecast to grow about 13.7% per year, which is slower than the broader US market forecast of 16.2%, so the higher P/E is not matched by faster growth in those estimates.
- The last five years saw average earnings decline around 11.2% per year, which critics see as a reminder that profitability has not followed a straight upward path even though the last 12 month earnings improved.
DCF Fair Value Sits Well Above Price
- The current share price of US£58.85 sits well below the indicated DCF fair value of about US£109.74, implying the stock trades roughly 46.4% under that cash flow based estimate while trailing revenue is US£25.9b.
- Supporters of the more optimistic view lean on this valuation gap and the growth forecasts behind it, but the same numbers also highlight some friction:
- Forecast revenue growth of about 6.3% a year is lower than the broader US market expectation of 10.6%, which means the DCF fair value assumes value in relatively moderate top line expansion rather than aggressive growth.
- At the same time, forecast EPS growth of roughly 13.7% per year is stronger than the company's five year earnings record of 11.2% annual declines, so the modelled upside relies on the recent 12 month earnings improvement proving more durable than the longer term average.
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[3]Next Steps
Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on Freeport-McMoRan's growth[4] and its valuation[5] to see if today's price is a bargain. Add the company to your watchlist[6] or portfolio[7] now so you don't miss the next big move.
See What Else Is Out There
Freeport-McMoRan pairs an 8.5% net margin with a premium 38.3x P/E and earnings forecasts that trail the broader US market, which raises valuation concerns.
If that rich multiple makes you cautious, shift your focus to these 878 undervalued stocks based on cash flows[8] to quickly find companies where current prices sit closer to, or below, their implied value. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data.
Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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References
- ^ See our full analysis for Freeport-McMoRan. (www.simplywall.st)
- ^ Curious how numbers become stories that shape markets?
Explore Community Narratives
(simplywall.st) - ^ Curious how numbers become stories that shape markets?
Explore Community Narratives
(simplywall.st) - ^ growth (www.simplywall.st)
- ^ valuation (www.simplywall.st)
- ^ watchlist (simplywall.st)
- ^ portfolio (simplywall.st)
- ^ these 878 undervalued stocks based on cash flows (simplywall.st)
- ^ Explore Now for Free (simplywall.st)
- ^ Get in touch (feedback.simplywall.st)
- ^ [email protected] (simplywall.st)