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Southern Copper (SCCO) Stock Sinks As Market Gains: What You Should Know

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In the latest trading session, Southern Copper (SCCO - Free Report) closed at $68.42, marking a -1.6% move from the previous day. This move lagged the S&P 500's daily gain of 2.14%. Meanwhile, the Dow gained 1.82%, and the Nasdaq, a tech-heavy index, lost 0.01%.

Heading into today, shares of the miner had gained 4.86% over the past month, outpacing the Basic Materials sector's gain of 3.08% and the S&P 500's loss of 5.01% in that time.

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 per share, which would represent year-over-year growth of 1.01%.

For the full year, our Zacks Consensus Estimates are projecting earnings of $4.02 per share and revenue of $10.41 billion, which would represent changes of -8.43% and -4.79%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for Southern Copper. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Southern Copper is currently sporting a Zacks Rank of #4 (Sell).

In terms of valuation, Southern Copper is currently trading at a Forward P/E ratio of 17.3. This represents a premium compared to its industry's average Forward P/E of 10.2.

It is also worth noting that SCCO currently has a PEG ratio of 2.25. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Mining - Non Ferrous stocks are, on average, holding a PEG ratio of 0.41 based on yesterday's closing prices.

The Mining - Non Ferrous industry is part of the Basic Materials sector. This group has a Zacks Industry Rank of 236, putting it in the bottom 8% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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