We recently published a list of Billionaire Stanley Druckenmiller’s Top 10 Stock Picks. In this article, we are going to take a look at where Freeport-McMoRan Inc. (NYSE:FCX) stands against other stock picks of Billionaire Stanley Druckenmiller.
Druckenmiller on the Fed’s Actions
On November 6, billionaire Stanley Druckenmiller appeared in a podcast, In Good Company, hosted by Nicolai Tangen, CEO of Norges Bank Investment Management. Druckenmiller shared his opinion on the easing cycle and the role of the Fed in the current economic backdrop. He shared that he is primarily keeping a close look at companies and is not seeing any signs of weakness, other than the housing market, that too because of elevated price levels. He also added that for the next 3 to 6 months, he does not expect any economic problems to overshadow the market.
Druckenmiller emphasized that the financial conditions are of more interest to him and that they have been very “loose, looser than they were when the Fed actually started tightening.” He is also particularly interested to see if the market is currently in the “70s rally since 2021” when the inflationary period started, expressing his concerns over inflation moving forward. In addition to inflationary concerns, Druckenmiller is also worried that the Fed had declared victory a tad bit early, lacking confidence in the current market backdrop.
He believes that with a 50 basis point cut, roaring equities, and no material weakness, the market may turn up again. Druckenmiller added that the Fed is “obsessed” with a soft landing and emphasized that “fine-tuning” and “worrying about a soft landing” is not their job. The reason why there is an urgency for a soft landing is because the Fed let the inflation rate jump in the first place, he added. Speaking of the Fed’s actions and forward guidance, Druckenmiller highlighted that the Fed believes that if it changes its due course of action, it may lose credibility, leaving its hands tied.
Stanley Druckenmiller is an American billionaire, investor, and founder of Duquesne Capital, with a net worth of $6.9 billion, as of December 14, 2024. Druckenmiller has made a fortune as a hedge fund manager for 30 big years and now manages money from his family office. He also worked with George Soros until 2000, a renowned investor known for shorting the pound in 1992. He also shares interesting opinions on the money market and the economy. In Q3 2024, Druckenmiller initiated 33 new positions, ending the quarter with a portfolio of $2.95 billion in 13F securities. With that, let’s discuss his top stock picks as of Q3 2024.
Our Methodology
We scanned Duquesne Capital’s Q3 2024 portfolio and picked the fund’s top 13F holdings. Additionally, we’ve also added overall hedge fund sentiment for each stock, as of Q3 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A large open-pit copper mine with heavy machinery extracting minerals from the earth.
Freeport-McMoRan Inc. (NYSE:FCX)
Duquesne Capital’s Stake Value: $68,737,000
Number of Hedge Fund Holders: 74
Freeport-McMoRan Inc. (NYSE:FCX) is a mining company that ranks eighth on our list of the top stock picks of Stanley Druckenmiller. The company is one of the largest producers of copper, gold, and molybdenum. While the company has expertise in several areas, it has an emphasis on long-lived copper assets. In the third quarter of 2024, copper and gold sales volume grew well above the July 2024 estimate and the levels from the third quarter of 2023. During the quarter, copper production reached 1.05 billion recoverable pounds, and sales were recorded at 1.04 billion recoverable pounds, 2% above the July 2024 estimate.
As of today, the company operates seven open-pit copper mines in North America, two copper mines in South America, and one of the largest copper and gold deposits in Indonesia through its subsidiary PT-FI. Towards the end of 2019, the subsidiary completed mining the final phase of the Grasberg open pit. From 1990 to 2019, the pit produced 33 billion pounds of copper and 53 million ounces of gold, including 27 billion pounds of copper and 46 million ounces of gold from the Grasberg open pit.
Overall, Freeport-McMoRan Inc. (NYSE:FCX) generated net income worth $526 million and $1.9 billion in operating cash flows in the third quarter of 2024. Consequently, consolidated sales for 2024 are expected to reach 4.1 billion pounds of copper, 1.8 million ounces of gold, and 80 million pounds of molybdenum. At the same time, the company expects production of gold and copper to exceed sales, representing 85 million pounds of copper and 85,000 ounces of gold in inventories for the next year. The company has a dominant position in the production and sale of copper, positioning it as a leader in the industry.
Overall, FCX ranks 8th on our list of Billionaire Stanley Druckenmiller’s stock picks. While we acknowledge the potential of FCX to grow, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than FCX but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.