I’m actually a big fan of FCX. Many of my old clients still own the stock because of me, long from as low as $7. Had I been managing money when the stock collapsed to the $3’s, I probably would’ve bought it.
The price of copper is ripping higher again, to 6 month highs, as the whole commodity space lifts…because inflation (duh).
But remember this statement from the recent conference call on April the 26th, 2016.
FCX says recent improvement in stocks and bonds could mean it considers other types of capital raises.
Expects to meet Spring collateral test at the end of Q2; is extremely confident in meeting that goal;
If leverage is greater than 6x, lenders would get 100% of proceeds; says will have ability to repay term loans and other debt; Debt levels have improved which opens up opportunities; focused on absolute leverage reduction. Comfortable with current maturity schedule.
Says was extremely frustrated to see were stock and debt was trading at and not having the money to buy them.
There are two things to note from that.
1. The company is going to file a secondary offering to raise capital. I’d bet my fucking life on it.
2. The company is pissed the fuck off about selling core assets to deleverage and are equally pissed off that they could not buy stock or bonds when they collapsed back in February.
While a secondary offering might be the best thing for the company, long term, as they get to keep some valuable assets, it’s a risk to the share price in the interim.
Buyers beware.
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I was pondering that one too at the moment. Shanghai Futures just had Copper a small tad higher (that Shanghai Copper Bubble is beyond Bubble now), Copper is holding up even with that super strong Yuan which we know China Govt NEEDS to pull back cuz they can’t let it run with the Yen (ouch). Japan of course is having their Kyle Bass Moment. IMHO copper run is someone getting to see the leaked Chinese PMI’s this weekend, again, lol. Just like buying the FANGS, just won’t work if BoJ doesn’t throw trillions of dollars at it. BTW I totally vote for the RBA to cut rates next week..they won’t probably, but I think they really should
And of course DXY getting near to 93, ouch. That Dollar Drop has to stop soon. BTW notice even with a weaker dollar how weak this market is.
stay focused, japan poison is capsizing! yen to moon
Dollar drops and oil rolls over for another big trip back down I think. I’m gonna go all in on DWTI when that happens as me and my clan take over all riverboats at the same time.
This time instead of WALLLLLAAAAAACE. we will scream NYYYYYYYYMMMMMMMPH!!!
china loves hyperbolic moves. they think of all money as lotto. be poor or be rich. no in between. but the raising of margin requirements usually is the tell of the end. then all the PM retards will claim manipulation. but they dont think it manipulation when it is going hyperbolic. reality is its manipulated all the time.