Down 24%! As the Glencore share price falls like snow, is it finally time to let it go?

Harvey Jones thought the Glencore share price was in bargain territory when he bought the FTSE 100 commodity giant last summer. Since then it’s turned his heart to ice.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Snowing on Jubilee Gardens in London at dusk

Image source: Getty Images

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

Christmas is coming so I’ll soon be watching Disney’s Frozen with the kids, which naturally makes me think of the Glencore (LSE: GLEN) share price.

The film’s signature tune, Queen Elsa’s Let It Go, popped into my head this morning while reviewing my position in the London-listed commodities giant.

Should you invest £1,000 in Tesco right now?

When investing expert Mark Rogers has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets. And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Tesco made the list?

See the 6 stocks

I bought Glencore shares on 26 July 2023 for 472.6p and again on 1 September that year for 429.1p.

Given that the shares had traded as high as 585.5p that January, I thought I was getting in at a bargain price but alas it wasn’t to be.

This FTSE 100 stock is a real tear jerker

Glencore’s troubles can be summed up in a single word: China. The world’s second biggest economy was a voracious consumer of metals and minerals for years, swallowing 60% of global production. But the glory days of double-digit GDP growth are over as Premier Xi Jinping tightens his political grip and repeated stimulus packages underwhelm. 

US President-elect Donald Trump’s plans to turn China into a “kingdom of isolation”, to quote the song, could test its limits.

And so the Glencore share price falls like snow. It’s down 18% over one year and 24.19% over two. At today’s 387.2p I’m personally down 15.22%. Actually, I’ve just refreshed my trading account, and it’s 15.97%.

So is it time to heed Queen Elsa’s sage advice and “Let it go, let it go, Turn away and slam the door”?

That goes about against my principles. I don’t buy FTSE 100 companies hoping to make a quick profit and move on. I look to hold them for years, ideally decades, to give their share prices and reinvested dividends time to compound and grow.

Glencore’s latest production guidance, published on 30 October, showed mixed performance for the first three quarters of the year, with copper, cobalt, zinc, and nickel output down but steelmaking coal significantly up.

A swirling storm of geopolitics

Production is one thing, price another. Commodity prices have been sliding since the energy shock and the latest World Bank estimates suggest little respite.

It forecasts that global commodity prices will slump to five-year lows in 2025, although that’s largely driven by oil. Industrial metal prices should be relatively stable for the next two years as tight supply offsets Chinese real estate woes. Also, the energy transition may drive demand for certain metals.

Glencore is still making a lot of money. First-half group adjusted EBITDA earnings plunged 33% to $6.3bn but the board could still cut net debt from $4.9bn to $3.6bn and find $1bn for shareholder returns. 

It also floated the prospect of “potential top-up shareholder returns, above our base cash distribution, in February 2025”.

I’m not missing that, and I’m not letting Glencore go. At some point, its shares should recover, possibly at speed.“Here I stand and here I stay”, as Queen Elsa declared. I’m with her.

Of course, there are plenty of other passive income opportunities to explore. And these may be even more lucrative:

We think earning passive income has never been easier

Do you like the idea of dividend income?

The prospect of investing in a company just once, then sitting back and watching as it potentially pays a dividend out over and over?

If you’re excited by the thought of regular passive income payments, as well as the potential for significant growth on your initial investment…

Then we think you’ll want to see this report inside Motley Fool Share Advisor — ‘5 Essential Stocks For Passive Income Seekers’.

What’s more, today we’re giving away one of these stock picks, absolutely free!

Get your free passive income stock pick

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Harvey Jones has positions in Glencore Plc. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

Businessman hand flipping wooden block cube from 2024 to 2025 on coins
Investing Articles

I bought 1,779 Legal & General shares 2 years ago – see how much dividend income I’ve got since

Harvey Jones holds Legal & General shares and has been pretty underwhelmed by their performance so far. The dividend is…

Read more »

Middle-aged black male working at home desk
Investing Articles

Is the FTSE 100 set to soar? Here are 3 ways to aim to cash in

My outlook for the FTSE 100 is definitely brightening as we get deeper into 2025. How can we make the…

Read more »

Investing Articles

£10k invested in NatWest shares on the ‘Liberation Day’ dip is today worth…

Harvey Jones looks at how NatWest shares have been knocked off course during recent market turbulence, but are now bouncing…

Read more »

Tariffs and Global Economic Supply Chains
US Stock

£5,000 invested in Nvidia stock just before the tariff news is now worth…

Jon Smith talks through the erratic movements in Nvidia stock over the past six weeks and reveals where an investor…

Read more »

Business manager working at a pub doing the accountancy and some paperwork using a laptop computer
Investing Articles

3 high-yield passive income stocks to consider buying right now

These stocks with big dividend yields look very tempting. Passive income investors could do well to consider taking the plunge.

Read more »

Handsome young non-binary androgynous guy, wearing make up, chatting on his smartphone, carrying shopping bags.
Investing Articles

Is a motley collection of businesses holding back this FTSE 100 stock?

Andrew Mackie explains why he's remained loyal to this FTSE 100 stock despite several of its businesses continuing to struggle…

Read more »

Businessman using pen drawing line for increasing arrow from 2024 to 2025
Investing Articles

3 top growth stocks driving wealth in my Stocks and Shares ISA

Our writer shines a light on a trio of outperforming growth firms in his Stocks and Shares ISA portfolio. They're…

Read more »

Young woman working at modern office. Technical price graph and indicator, red and green candlestick chart and stock trading computer screen background.
Investing Articles

Here’s where analysts expect the Lloyds share price to be a year from now

The Lloyds share price has fared well so far in 2025. But with some big issues on the horizon, can…

Read more »