Comparing Southern Copper (SCCO) and The Competition

Southern Copper (NYSE: SCCO) is one of 50 publicly-traded companies in the “Metal mining” industry, but how does it contrast to its peers? We will compare Southern Copper to similar companies based on the strength of its earnings, analyst recommendations, institutional ownership, dividends, risk, profitability and valuation.

Earnings and Valuation

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This table compares Southern Copper and its peers top-line revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Southern Copper $6.65 billion $728.50 million 54.36
Southern Copper Competitors $5.83 billion $914.34 million 71.37

Southern Copper has higher revenue, but lower earnings than its peers. Southern Copper is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Volatility and Risk

Southern Copper has a beta of 0.46, indicating that its stock price is 54% less volatile than the S&P 500. Comparatively, Southern Copper’s peers have a beta of 5.57, indicating that their average stock price is 457% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and price targets for Southern Copper and its peers, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Southern Copper 2 3 3 0 2.13
Southern Copper Competitors 302 1021 1236 77 2.41

Southern Copper presently has a consensus price target of $45.40, indicating a potential downside of 16.48%. As a group, “Metal mining” companies have a potential upside of 17.54%. Given Southern Copper’s peers stronger consensus rating and higher possible upside, analysts plainly believe Southern Copper has less favorable growth aspects than its peers.

Profitability

This table compares Southern Copper and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Southern Copper 10.95% 11.57% 5.33%
Southern Copper Competitors -486.45% -23.21% -1.73%

Institutional & Insider Ownership

6.9% of Southern Copper shares are held by institutional investors. Comparatively, 24.9% of shares of all “Metal mining” companies are held by institutional investors. 0.5% of Southern Copper shares are held by insiders. Comparatively, 11.9% of shares of all “Metal mining” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

Southern Copper pays an annual dividend of $1.20 per share and has a dividend yield of 2.2%. Southern Copper pays out 120.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Metal mining” companies pay a dividend yield of 3.7% and pay out 62.1% of their earnings in the form of a dividend. Southern Copper lags its peers as a dividend stock, given its lower dividend yield and higher payout ratio.

Summary

Southern Copper peers beat Southern Copper on 11 of the 15 factors compared.

Southern Copper Company Profile

Southern Copper Corporation is an integrated copper producer. It produces copper and, in the production process, obtains several by-products, including molybdenum, silver, zinc, sulfuric acid and other metals. Its segments include the Peruvian operations, the Mexican open-pit operations and the Mexican underground mining operations segment identified as the IMMSA unit. The Peruvian operations segment includes the Toquepala and Cuajone mine complexes, and the smelting and refining plants, including a metals plant industrial railroad and port facilities that service both mines. The Mexican open-pit operations segment includes the La Caridad and Buenavista mine complexes, and the smelting and refining plants, including a metals plant and a copper rod plant, and support facilities that service both mines. As of December 31, 2016, the Mexican underground mining operations segment included five underground mines that produce zinc, copper, silver and gold, a coal mine and a zinc refinery.

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