Incredibly, Freeport-McMoRan Inc (NYSE:FCX) stock has delivered a return of 4% since its 1995 spin-off. That’s not a 4% return per year, mind you. Rather, FCX stock has risen 4% total since 1995.

To be fair, if you add in dividends, Freeport-McMoRan stock has returned about 2.6% per year, on average. But that quite obviously is an underperformance relative to both broad markets and to copper itself. Copper prices have more than doubled over that nearly 23-year stretch; FCX stock has returned about 76%,

To be fair, FCX stock isn’t the only miner to provide poor returns. Barrick Gold Corp (USA) (NYSE:ABX) has provided negative returns over the same period. Southern Copper Corp (NYSE:SCCO) shareholders have lost money over the past decade. Franco Nevada Corp (NYSE:FNV) has been one of the few large-cap miners to actually drive shareholder returns.

Freeport-McMoRan stock, however, has suffered from self-inflicted wounds. FCX bought Phelps Dodge with copper at a peak in early 2007. It decided to reacquire its oil and gas operations in 2012, not long before prices in both commodities plunged. For all of the discussion about the company’s leverage to copper prices — and what those prices might be — execution has been extremely poor. FCX stock has rarely, if ever, provided what its investors want: leverage to higher copper prices.

With Freeport-McMoRan stock down about 25% from a near-term peak, I remain skeptical that will change any time soon. FCX remains a company beset by troubles and execution errors. And Freeport-McMoRan stock remains an ‘avoid’ — at best.

FCX Stock Has the Wrong Kind Of Leverage

It might be tempting to assume that Freeport-McMoRan stock has declined of late simply because of lower copper prices. That’s not really the case. The acquisition of its former O&G business (spun off in 1994) along with Plains Exploration cost some $9 billion. FCX dumped most of those assets to Anadarko Petroleum Corporation (NYSE:APC) for $2 billion last year.

Even with that sale and the divestment of its stake in the Tenke mine in the Democratic Republic of Congo, Freeport-McMoRan still has some $16 billion in debt, and over $12 billion on a net basis. To get even to that point, the company not only sold assets, but cut the dividend and issued $1.5 billion in new FCX stock. Both actions sent Freeport-McMoRan stock lower.

Looking forward, it may be that FCX can get back to providing some sort of leverage to higher prices. According to the company’s fourth quarter earnings presentation, a simple $0.10 per pound change in copper prices could add $415 million in EBITDA, and $320 million in cash flow. But the problem with the balance sheet is that it magnifies any downside risk. A move in copper back to $2 would wipe out a substantial amount of Freeport-McMoRan’s cash flow. And that would lead FCX stock to plunge even further.

Indonesia, Copper Prices, And Freeport-McMoRan Stock

Meanwhile, Freeport-McMoran is engaged in a dispute over its Grasberg mine in Indonesia. The Indonesian government now says it is entitled to take a majority stake, against current holdings just over 9%. FCX bitterly disagrees, but it’s not clear whether it will win, even if its interpretation of the agreement is correct. Meanwhile, workers at the mine have threatened a strike, given that Freeport-McMoRan has cut back production substantially.

The irony for FCX stock is that its travails are in part keeping the price of copper up. Limited production from Grasberg, and strikes at its Cerro Verde mine in Peru and another Chilean mine majority-owned by BHP Billiton Limited (ADR) (NYSE:BHP), have helped copper prices stay afloat.

So it seems likely that a resolution for FCX in either Chile and/or Indonesia might also lead copper prices back down, as that supply returns to the market. And that likely would offset some of the benefit of that good news for Freeport-McMoRan stock.

The broader issue, from a historical perspective, is that it’s easy to assume these problems are one-time. But for worldwide miners, usually operating in developing countries with lower levels of corporate legal protection, these issues are somewhat common. And that’s a big reason why FCX stock hasn’t done what it’s supposed to do.

Bullish Copper? Buy Copper

At the end of the day, any bull case for Freeport-McMoRan stock requires some amount of bullishness on worldwide copper prices. But in this day and age, there’s no reason to buy FCX stock — or SCCO stock — to get that exposure. Copper exchange-traded funds and exchange-traded notes are available, with no execution risk. Even individual investors can make higher-risk futures and options trades in most accounts.

I’m not recommending those trades, to be sure. But for investors who want to profit from a rise in copper, the simplest and most logical way seems to be to buy copper directly, in some form. Expecting FCX to provide that exposure in a profitable way ignores both the company’s history and its current situation. And it means that FCX stock isn’t “cheap enough”, even down 25%.

As of this writing, Vince Martin did not hold a position in any of the aforementioned securities.