A Fresh Look at Southern Copper’s (SCCO) Valuation Following Recent 3-Month Surge

Southern Copper (SCCO) has drawn fresh attention from investors after its latest market moves. Confidence remains steady following a strong 3-month performance, with the stock advancing 40% and outpacing materials sector peers.

See our latest analysis for Southern Copper.

Southern Copper's impressive surge has not gone unnoticed. Over the past year, the company has delivered a total shareholder return of 43.8%, with strong momentum building as evidenced by recent quarterly gains. Short-term fluctuations aside, this upswing reflects renewed optimism in the miner's outlook and valuation story.

If Southern Copper’s momentum makes you wonder what else could be trending, it might be time to discover fast growing stocks with high insider ownership

But after such a rapid climb, investors have to ask: Is Southern Copper still trading at an attractive valuation, or has the robust growth story already been priced in by the market, leaving limited room for upside?

Most Popular Narrative: 14.5% Overvalued

With Southern Copper’s shares closing at $134.78, the most widely followed narrative arrives at a fair value of $117.76, well below the current price. The steep valuation sets the scene for a closer look at what is driving analyst sentiment.

Southern Copper has announced substantial capital investments totaling over $15 billion, including projects in Mexico and Peru, which are expected to drive future production growth and potentially boost revenue significantly. The company's Buenavista zinc concentrator is now operating at full capacity, anticipated to drive a 31% increase in zinc production in 2025, likely enhancing revenues and improving net margins due to efficient operations.

Read the complete narrative.

Want to know what is fueling this premium valuation? It comes down to ambitious growth projections and projected profit improvements. Yet a single key variable could tip the scales. Which bold assumptions are analysts betting on? Get the inside story behind the premium price.

Result: Fair Value of $117.76 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, analyst optimism could be challenged if U.S.-China trade tensions escalate or if operational disruptions such as project delays worsen, impacting earnings and sentiment.

Find out about the key risks to this Southern Copper narrative.

Build Your Own Southern Copper Narrative

If you see the story differently or want to build an investment thesis yourself, you can craft your own perspective in just a few minutes. Do it your way

A great starting point for your Southern Copper research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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