Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer.

Trade-Ideas LLC identified Freeport-McMoRan ( FCX) as a pre-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified Freeport-McMoRan as such a stock due to the following factors:

  • FCX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $381.1 million.
  • FCX traded 22,168 shares today in the pre-market hours as of 8:45 AM.
  • FCX is down 2.7% today from yesterday's close.

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More details on FCX:

Freeport-McMoRan Inc., a natural resource company, engages in the acquisition of mineral assets, and oil and natural gas resources. It primarily explores for copper, gold, molybdenum, cobalt, silver, and other metals, as well as oil and gas. The stock currently has a dividend yield of 1%. Currently there are 8 analysts that rate Freeport-McMoRan a buy, 1 analyst rates it a sell, and 6 rate it a hold.

The average volume for Freeport-McMoRan has been 20.1 million shares per day over the past 30 days. Freeport-McMoRan has a market cap of $21.5 billion and is part of the basic materials sector and metals & mining industry. The stock has a beta of 2.25 and a short float of 5.3% with 2.87 days to cover. Shares are down 13.4% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Freeport-McMoRan as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, generally high debt management risk, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Metals & Mining industry. The net income has significantly decreased by 503.4% when compared to the same quarter one year ago, falling from $707.00 million to -$2,852.00 million.
  • The debt-to-equity ratio of 1.04 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, FCX has a quick ratio of 0.59, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Metals & Mining industry and the overall market on the basis of return on equity, FREEPORT-MCMORAN INC underperformed against that of the industry average and is significantly less than that of the S&P 500.
  • Net operating cash flow has significantly decreased to $1,118.00 million or 53.33% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, FREEPORT-MCMORAN INC has marginally lower results.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 36.90%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 504.41% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.

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