With Freeport-McMoRan Inc (NYSE:FCX) preparing to release second-quarter results on Tuesday, July 25, Berenberg analyst Fawzi Hanano is out with a bearish forecast. The analyst reiterates a Sell rating on the stock, with a $10 price target, which reflects a potential downside of 23% from yesterday’s closing price. (To watch Hanano’s track record, click here)

Hanano opined, “Freeport has provided Q2 2017 sales guidance of 442kt (975m lbs) of copper and 440koz of gold. We do not expect this to be achieved and we are 4% lower for copper and over 20% lower for gold. We note that the qoq trend is up, particularly for gold where we forecast a near doubling of sales, reflecting the restart of full operations at Grasberg in mid-April. However, continued labour issues at the Grasberg mine have likely affected production in the quarter, and this drives our lower expectations, particularly for gold.”

“We expect management to reduce the 2017E guidance for copper and gold sales at the Q2 results. Our current estimates are c2.5% below guidance for copper and c13% below for gold,” the analyst added.

Overall, out of the 9 analysts polled in the past 3 months, 2 are bullish on Freeport-McMoRan stock, 6 are sidelined, while one is bearish on the stock. With a return potential of nearly 8%, the stock’s consensus target price stands at $14.06.