Deutsche Bank Weighs In on Freeport-McMoRan Inc (FCX) and NXP Semiconductors NV (NXPI) Following Earnings Announcements


Deutsche Bank analysts are out today with some quick thoughts on energy and mining firm Freeport-McMoRan Inc (NYSE:FCX) and Dutch chip maker NXP Semiconductors NV (NASDAQ:NXPI), following recent earnings announcements.

Freeport-McMoRan Inc

Deutsche Bank analyst Jorge Beristain reiterated a Hold rating on shares of Freeport-McMoRan, while reducing the price target to $6 (from $7), which implies an upside of 6% from current levels.

Beristain explained, “Post-4Q15 results, our EBITDA estimates for 2016/17 cut by 14%/2% as lower DB oil price deck, more-than-offsets “latest” management guidance on lower costs and capex. All-in, we find our estimated Net Present Value reduced to $8 (from $9 prior), leading us to trim again PT to $6 (from $7) based on 0.8x NPV multiple (0.7x prior) which assumes further dilution. Hold maintained given downside of $3/sh to our NPV if spot oi l prices persist, highly levered BS and uncertainty around timing/execution of disposals (Freeport targeting $5-10bn of debt reduction). Recent Moody’s credit downgrade by 4-notches with a negative outlook stresses need to make good on promised asset sales.”

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Jorge Beristain has a yearly average return of -11.7% and a 31% success rate. Beristain has a -15.5% average return when recommending FCX, and is ranked #3522 out of 3612 analysts.

Out of the 10 analysts polled by TipRanks, 3 rate Freeport-McMoRan stock a Buy, 6 rate the stock a Hold and 1 recommends a Sell. With a return potential of 67%, the stock’s consensus target price stands at $9.44.

NXP Semiconductors NV

In addition, Deutsche Bank’s Ross Seymore reiterated a Buy rating on shares of NXP Semiconductors, with a price target of $110, after the company delivered 4Q15 sales/EPS of $1.61B/$1.25, ahead of the Street’s $1.54B/$1.02 estimates on better GM and OM. 1Q results were guided up 38%, at mid-point, to $2.21B/$1.10, roughly in line with the Street’s $2.25B/$1.08E. The stock reacted to the news, rising nearly 8% in mid-day trading.

Seymore commented, “After providing a surprisingly poor 4Q guide, NXPI appears to be back on track with a solid 4Q report & 1Q guide. We continue to see significant upside to NXPI shares as stabilizing revenue, accelerating cost cuts and debt reduction create EPS and FCF upside. Key questions for the conference call on 2/4/16 at 8am ET include segment demand trends (especially in Auto), channel inventory levels and cost synergy progress/target updates.”

According to TipRanks.com, analyst Ross Seymore has a yearly average return of 15.3% and a 58% success rate. Seymore has a 8% average return when recommending NXPI, and is ranked #73 out of 3612 analysts.