Berenberg analyst Fawzi Hanano weighs in on Freeport-McMoRan Inc (NYSE:FCX) following the company’s second-quarter earnings report. The analyst reiterates a Hold rating on FCX with a price target of $11.00.

The company reported copper production that was 3% below the analyst’s estimates. This reflects lower-than-expected output at the company’s Grasberg mine in Indonesia, which also led to lower-than-expected gold production and sales given lower grades.  The analyst adds, “Quarterly sales of oil equivalents at 12.5m barrels was 8% below our estimate and guidance, with management subsequently lowering its 2016 sales guidance by c13% to 47.4MMBOE. Cost performance was better than we expected at USD15/barrel, however 2016 guidance was raised to USD15.5/barrel reflecting the lower production.”

According to the analyst, debt reduction will remain a priority for the company, after they reported in-line Q2 results.  Hanano explains, “The company ended the quarter with net debt just below USD19bn, slightly better than our USD19.3bn estimate reflecting better operating cash-flow generation and lower capex spent. Management is taking the right steps operationally to conserve cash, and the near-term focus remains on debt reduction with Freeport to commence an at-the-market common stock offering of up to USD1.5bn.”

According to TipRanks, Fawzi Hanano is ranked #2,906 of 4,083 analysts on TipRanks. He maintains a 0% success rate and realizes an average loss of 6.1%.

TipRanks analytics exhibits FCX as a Moderate Buy with 29% of analysts issue a Buy rating, while 71% maintain a Hold rating on the stock. The consensus target price for FCX is $12.50, marking a 1.42% downside from current prices.