This story originally appeared on Zacks
Southern Copper (SCCO) closed the most recent trading day at $60.88, moving -0.29% from the previous trading session. This move lagged the S&P 500’s daily gain of 0.14%. At the same time, the Dow added 0.25%, and the tech-heavy Nasdaq lost 0.34%.
Coming into today, shares of the miner had gained 4.38% in the past month. In that same time, the Basic Materials sector gained 4%, while the S&P 500 gained 4.32%.
Southern Copper will be looking to display strength as it nears its next earnings release. On that day, Southern Copper is projected to report earnings of $1.18 per share, which would represent year-over-year growth of 55.26%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.61 billion, up 10.84% from the year-ago period.
SCCO’s full-year Zacks Consensus Estimates are calling for earnings of $4.49 per share and revenue of $10.94 billion. These results would represent year-over-year changes of +121.18% and +36.97%, respectively.
It is also important to note the recent changes to analyst estimates for Southern Copper. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 2.04% higher within the past month. Southern Copper currently has a Zacks Rank of #3 (Hold).
Looking at its valuation, Southern Copper is holding a Forward P/E ratio of 13.59. For comparison, its industry has an average Forward P/E of 10.65, which means Southern Copper is trading at a premium to the group.
Also, we should mention that SCCO has a PEG ratio of 0.84. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company’s expected earnings growth rate into account. The Mining – Non Ferrous was holding an average PEG ratio of 0.47 at yesterday’s closing price.
The Mining – Non Ferrous industry is part of the Basic Materials sector. This group has a Zacks Industry Rank of 189, putting it in the bottom 26% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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