Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) opened at $62.27. So far today the stock has hit a low of $61.80 and a high of $63.29. As of 10:35 this morning, FCX is trading at $62.98, up $0.54 (0.9%).

The stock hit its 52 week high of $72.20 in April and set its 52 week low of $43.10 in June. Jim Cramer loves FCX and says that he believes it is time to buy shares of the company "hand over fist." He believes that the demand coming from China and its fast growing industries is going to push copper prices up dramatically. He believes that the acquisition of Phelps Dodge (NYSE: PD) was a good move that could help lift shares of their stock well above the $80 target some analysts are expecting. The technical indicators for the stock are bullish and steady while S&P gives FCX a positive 4 STARS (out of 5) buy rating.

For a bullish hedged play on this stock, I would consider a May bull-put credit spread below the $50 range. FCX hasn't been below $50 for more than a few days since June and has shown support around $53. This trade could be risky if copper prices nosedive in the next few months, but there might be some positive feelings surrounding the PD acquisition that could protect this position.

Brent Archer is an analyst on the move at Investors Observer (Free Subscription). DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about.

On 14 March 2007, Phelps Dodge Corporation (NYSE:PD) was acquired by Freeport-McMoRan Copper & Gold Inc. (NYSE:FCX) to form the world's largest copper mining company. The purchase price was $26 billion. Now that is a whole lot of pennies. $6 billion of the purchase price stems from bonds issued by FCX. Phelps Dodge shareholders will receive $88 in cash for each share of PD common stock, plus 0.67 of a share of FCX's common stock for each share of PD common stock. PD shareholders will pocket a total of $18 billion in cash. This works out to $125.53 per share of PD common stock. Shares of PD closed at $127.93 on 15 March 2007, up $2.22 per share. For its part, FCX shareholders authorized an increase in the number of shares of FCX common stock available from 423.6 million to 700 million.

Phelps Dodge has been on a tear lately reporting 4Q 2006 record net income of $1,324.3 million, or $6.50 per share for the quarter. Compare that figure to 4Q 2005 net income of $121.3 million, or 60 cents per share. 4Q 2006 price of copper per pound averaged $3.19 on the New York Commodity Exchange, compared to $2.02 for 4Q 2005.

Total 2006 net income exceeded $3 billion, bouyed in part by strong prices for copper and molybdenum, as well as by new mining operations at the Cerro Verde mine in Peru, the Safford mine in Arizone, and the Tenke Fungurume in the Democratic Republic of the Congo.

MOST NOTEWORTHY: Genesis Microchip Inc (GNSS), Columbia Sportswear Co (COLM) and Gentex Corp (GNTX) were today's most notable downgrades:

• Genesis Microchip Inc (NASDAQ: GNSS) was downgraded to Sell from Hold at Roth Capital, citing the loss of significant market share, and to Market Weight from Overweight at Thomas Weisel following the company's disappointing earnings report.

• Columbia Sportswear Co (NASDAQ: COLM) was downgraded to Sell from Hold at Matrix USA based on valuation.

• Calyon downgraded Gentex Corp (NASDAQ: GNTX) to Sell from Neutral.

OTHER DOWNGRADES:

• Following the company's fourth-quarter report, Buckingham downgraded International Flavors & Fragrances Inc (NYSE: IFF) to Neutral from Accumulate.

• Bank of America downgraded Clear Channel Communications Inc (NYSE: CCU) to Neutral from Outperform with a $37 target, as shares are pricing a best-case scenario of a deal and sees downside risk if the deal falls apart.

• Following fourth-quarter results and reduced guidance, Friedman Billings downgraded shares of Phelps Dodge Corp (NYSE: PD) to Market Perform from Outperform with a $125 target.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).

Stock futures were negative in early morning but have changed direction and are now indicating to a positive start for the S&P 500 and possible higher start for the Nasdaq as well as investors are jittery ahead of a very busy week. This week will be not only busy with earnings results, but with economic reports and a Federal Reserve policy meeting.

After rising in Asia overnight, oil prices eased a little this morning while the dollar gained against the yen, but was unchanged against the euro.

In corporate news, first earnings:

Mattel Inc. (NYSE:MAT) posted a 3% fourth-quarter profit growth. Net income grew to $286.4 million, or 75 cents per share, on revenue of $2.11 billion, a 14% increase over last year. Analysts surveyed by Thomson Financial expected earnings of 67 cents per share on revenue of $1.99 billion.

Schering-Plough Corp. (NYSE:SGP) reported a 75% surge in fourth-quarter profit as net income totaled $182 million, or 12 cents per share. Excluding items, the company posted profit of 17 cents per share, in line with analysts' estimates.


In deal news, Citigroup Inc. (NYSE:C) has agreed to buy British insurer Prudential's Internet bank Egg for $1.13 billion in cash.

US Airways Group Inc. (NYSE:LCC) is willing to increase its hostile takeover offer for Delta Air Lines Inc. by $1 billion, according to people familiar with the matter, the Wall Street Journal reports.

There are a few rumors of deals that could affect certain stocks today, mainly relating Bank of America Corp. (NYSE:BAC) possibly making a bid for Countrywide Financial Corp. (NYSE:CFC), while Sanofi-Aventis and Bristol-Myers Squibb Co. (NYSE:BMY) could announce a merger. BMY shares are gaining 6.8% in pre-market.

Notable analysts calls this morning include upgrades to Buy of Home Depot Co (NYSE:HD) and Lowe's Companies (NYSE:LOW) by AG Edwards while Kroger Co. (NYSE:KR) was upgraded to Buy from Sell by Banc of America. Meanwhile MGM Mirage (NYSE:MGM) was downgraded by Bear Stearns to Peer Perform from Outperform.

Even though it's a smaller company, Freeport-McMoRan Copper & Gold Inc. (NYSE:FCX) has made a $25.9 billion bid for Phelps Dodge Corp. (NYSE:PD). If the deal closes, the new entity will be the largest publicly-traded copper company worldwide.

It's certainly a nice deal for shareholders of Phelps Dodge. The offer is for about $126 per share -- a nice premium to Friday's close of $95.02.

Interestingly enough, it appears this was a fairly quick deal (about a couple weeks). Then again, for companies of this size, it is not easy to keep things confidential.

The deal means Freeport-McMoRan would be taking on a lot of debt. Then again, the debt markets are quite frothy right now. Besides, Freeport-McMoRan knows how to generate strong cash flows, which will help to pay-down the debt load.

Besides being accretive on the short-run, the long-term prospects of this deal look good as well. After all, China and India are undergoing major growth, which should mean a big need for copper. To fulfill this growing need for copper, Freeport-McMoRan needs a highly scalable global platform. And Phelps Dodge is certainly a great fit.

Tom Taulli is the author of various books, including the Complete M&A Handbook and operates InvestorOffering.com.

MOST NOTEWORTHY: Phelps Dodge (PD) and MGM Mirage (MGM) top today's small list of initiations.

• Phelps Dodge Corporation (NYSE:PD) was initiated with a Sector Outperformer at CIBC and a $125 target. CIBC believes the company will continue and possibly expand their $2B shareholder capital return program.
• FTN Midwest initiated MGM Mirage (NYSE:MGM) with a Buy and $57 target. They are positive on MGM's best in class assets.

OTHER INITIATIONS:

• First Albany initiated Joseph A. Banks (NASDAQ:JOSB) with a Neutral, citing the lack of near-term catalysts for its rating.
• UBS initiated Allied Waste Industries, Inc. (NYSE:AW) with a Buy and $15 target.
• Credit Suisse reinstated KLA-Tencor Corp. (NASDAQ:KLAC) with a Neutral.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).

Today on Jim Cramer's STOP TRADING segment on CNBC, he raved: "the market is making fortunes people!"

He said Yum! Brands, Inc. (NYSE:YUM) and McDonald's Corporation (NYSE:MCD) are winning on food and he was positive on Darden Restaurants, Inc. (NYSE:DRI) and The Procter & Gamble Company (NYSE:PG).

He said the fuel is coming out of oil and out of staples, and "the market is going higher." He even used the "so sue me" disclaimer afterward, but that's Cramer for you.

PepsiCo, Inc. (NYSE:PEP) wasn't that great and he is out of Kellogg Company (NYSE:K).

Phelps Dodge Corporation (NYSE:PD) is big and it is going to par, meaning $100. PD is trading at just under $93.00 as of his comments.

Now here is the problem with his segment; it's not just the criticism he gets so often, that he has too many pieces of advice. He was talking so fast you could barely understand him. He jokes about taking drugs; it would be easier to keep up if you were on speed while you watched.

Jon Ogg is a partner in 24/7 Wall St., LLC; he does not own securities in the companies he covers.