Freeport-McMoRan's Stock Surges After Jefferies Turns Bullish

Shares of Freeport-McMoRan Inc. 6.8% in active morning trade Tuesday, Jefferies turned bullish on the mining company, citing optimism over the impact of recent asset sales and an attractive relative valuation. Analyst Christopher LaFemina raised his rating to buy from hold, and boosted his stock price target to $15, which is 30% above current levels, from $12.50. The asset sales announced so far this year have been made at "much higher-than-expected" multiples, LaFemina said. "Despite the macro risks, we are more positive on [Freeport] shares now than we were earlier this year, as the company is making accretive asset sales and is entering a period of strong [free cash flow] due to lower costs and capex," LeFemina wrote in a note to clients. The macro risks LaFemina refers to include uncertainty over China's economic growth and the geopolitical situation in Indonesia. Given that the stock had tumbled 21% month to date through Monday, while the S&P 500 was up 0.1%, LaFemina said "it is time to buy FCX now."