Southern Copper (SCCO): Valuation Spotlight After Record Q3 Earnings and Growth Plans

Southern Copper, following its third-quarter earnings announcement, has caught the market’s attention. The company reported record highs in net sales, net income, and EBITDA, sparking fresh interest from investors.

See our latest analysis for Southern Copper.

The momentum around Southern Copper is hard to miss, with its share price climbing over 51% year-to-date and surging nearly 41% in the past three months alone. These moves reflect investors warming up to its growth story after strong earnings, higher dividends, and forward-looking project updates. Over the long term, the company has also delivered an impressive 30.6% total shareholder return in the past year, making it a standout in the sector as optimism builds for continued expansion.

If Southern Copper's streak of strong results has you rethinking where opportunities might emerge next, it could be a great time to broaden your search and discover fast growing stocks with high insider ownership

But after such a strong run, the big question for investors is whether Southern Copper’s fundamentals still offer value or if the market is already pricing in most of its future growth potential. Is there still a real buying opportunity here?

Most Popular Narrative: 14.3% Overvalued

Southern Copper’s latest close sits well above the most widely followed narrative’s fair value estimate, raising questions about just how much optimism is now priced in. With the fair value pegged at $118.88 and the stock trading at $135.92, the core assumptions behind this valuation become even more critical for investors watching these swings.

*“Expansion projects such as Tia Maria, Los Chancas, and Michiquillay are progressing, with expectations for additional production capacity, which could positively impact revenue and earnings starting in 2027 through 2030. Operational efficiencies and a strong focus on cost control have led to a reduction in cash costs, with expectations to sustain low costs between $0.75 to $0.80 per pound of copper in 2025, potentially boosting net margins and earnings.”*

Read the complete narrative.

Why is this valuation so punchy? The current narrative hinges on high-stakes projects and lean cost structures coming together at just the right time. But what if their financial forecasts are even bolder than they seem? There is one metric at the heart of their price target that might surprise you. Find out what makes this storyline tick.

Result: Fair Value of $118.88 (OVERVALUED)

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

However, rising operating costs or major project delays could challenge these growth assumptions and quickly change the outlook for Southern Copper’s valuation.

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

Build Your Own Southern Copper Narrative

If you see things differently or want to dig into the numbers on your own, you can shape a narrative 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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