Southern Copper Corporation Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

Southern Copper Corporation (NYSE:SCCO) investors will be delighted, with the company turning in some strong numbers with its latest results. The company beat forecasts, with revenue of US$2.6b, some 4.4% above estimates, and statutory earnings per share (EPS) coming in at US$0.95, 28% ahead of expectations. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Southern Copper after the latest results.

See our latest analysis for Southern Copper

Taking into account the latest results, the consensus forecast from Southern Copper's 14 analysts is for revenues of US$11.2b in 2024. This reflects a meaningful 15% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 38% to US$4.19. Before this earnings report, the analysts had been forecasting revenues of US$10.7b and earnings per share (EPS) of US$3.67 in 2024. So it seems there's been a definite increase in optimism about Southern Copper's future following the latest results, with a solid gain to the earnings per share forecasts in particular.

Althoughthe analysts have upgraded their earnings estimates, there was no change to the consensus price target of US$82.64, suggesting that the forecast performance does not have a long term impact on the company's valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Southern Copper analyst has a price target of US$136 per share, while the most pessimistic values it at US$55.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The analysts are definitely expecting Southern Copper's growth to accelerate, with the forecast 21% annualised growth to the end of 2024 ranking favourably alongside historical growth of 8.8% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 4.9% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Southern Copper is expected to grow much faster than its industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Southern Copper's earnings potential next year. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Southern Copper going out to 2026, and you can see them free on our platform here..

You still need to take note of risks, for example - Southern Copper has 2 warning signs (and 1 which doesn't sit too well with us) we think you should know about.

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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.