Reviewing Southern Copper (SCCO) and Its Rivals

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

Analyst Ratings

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This is a breakdown of current recommendations for Southern Copper and its rivals, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Southern Copper 4 4 2 0 1.80
Southern Copper Competitors 307 1026 1248 77 2.41

Southern Copper currently has a consensus target price of $46.07, suggesting a potential downside of 17.96%. As a group, “Metal mining” companies have a potential upside of 6.95%. Given Southern Copper’s rivals stronger consensus rating and higher possible upside, analysts plainly believe Southern Copper has less favorable growth aspects than its rivals.

Dividends

Southern Copper pays an annual dividend of $1.20 per share and has a dividend yield of 2.1%. 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 2.6% and pay out 47.8% of their earnings in the form of a dividend. Southern Copper lags its rivals as a dividend stock, given its lower dividend yield and higher payout ratio.

Profitability

This table compares Southern Copper and its rivals’ 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 -462.22% -23.22% -1.74%

Earnings & Valuation

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

Gross Revenue Net Income Price/Earnings Ratio
Southern Copper $6.65 billion $728.50 million 56.16
Southern Copper Competitors $5.83 billion $914.33 million 77.15

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

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 company insiders. Comparatively, 11.9% of shares of all “Metal mining” companies are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Volatility and Risk

Southern Copper has a beta of 0.47, meaning that its share price is 53% less volatile than the S&P 500. Comparatively, Southern Copper’s rivals have a beta of 5.58, meaning that their average share price is 458% more volatile than the S&P 500.

Summary

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

About Southern Copper

Southern Copper Corporation engages in mining, exploring, smelting, and refining copper and other minerals in Peru, Mexico, Argentina, Chile, and Ecuador. The company is involved in the mining, milling, and flotation of copper ore to produce copper and molybdenum concentrates; smelting of copper concentrates to produce blister and anode copper; refining of anode copper to produce copper cathodes; production of molybdenum concentrate and sulfuric acid; production of refined silver, gold, and other materials; and mining and processing of zinc and lead. It operates the Toquepala and Cuajone open-pit mines, and a smelter and refinery in Peru; and La Caridad, an open-pit copper mine, as well as a copper ore concentrator, a SX-EW plant, a smelter, refinery, and a rod plant. The company also operates Buenavista, an open-pit copper mine, as well as two copper concentrators and three SX-EW plants in Mexico. In addition, it operates five underground mines that produce zinc, lead, copper, silver, and gold; a coal mine that produces coal and coke; and a zinc refinery. It has interests in 44,182 hectares of exploration concessions in Peru; 148,122 hectares of exploration concessions in Mexico; 64,899 hectares of exploration concessions in Argentina; 36,387 hectares of exploration concessions in Chile; and 7,298 hectares of exploration concessions in Ecuador. The company was founded in 1952 and is based in Phoenix, Arizona. Southern Copper Corporation is a subsidiary of Americas Mining Corporation.

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