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Southern Copper (SCCO) Registers a Bigger Fall Than the Market: Important Facts to Note

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In the latest trading session, Southern Copper (SCCO - Free Report) closed at $109.12, marking a -1.28% move from the previous day. This change lagged the S&P 500's 0.16% loss on the day. Meanwhile, the Dow experienced a rise of 0.04%, and the technology-dominated Nasdaq saw a decrease of 0.18%.

The the stock of miner has fallen by 5.16% in the past month, leading the Basic Materials sector's loss of 6.35% and undershooting the S&P 500's gain of 3.15%.

Analysts and investors alike will be keeping a close eye on the performance of Southern Copper in its upcoming earnings disclosure. In that report, analysts expect Southern Copper to post earnings of $1.06 per share. This would mark year-over-year growth of 51.43%. Meanwhile, the latest consensus estimate predicts the revenue to be $2.8 billion, indicating a 21.56% increase compared to the same quarter of the previous year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $4.22 per share and revenue of $11.29 billion. These totals would mark changes of +35.69% and +14.08%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for Southern Copper. These revisions help to show the ever-changing nature of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. 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, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 6.25% higher. Southern Copper is currently a Zacks Rank #2 (Buy).

With respect to valuation, Southern Copper is currently being traded at a Forward P/E ratio of 26.18. This denotes a premium relative to the industry's average Forward P/E of 15.51.

Also, we should mention that SCCO has a PEG ratio of 1.21. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. As the market closed yesterday, the Mining - Non Ferrous industry was having an average PEG ratio of 0.79.

The Mining - Non Ferrous industry is part of the Basic Materials sector. This industry, currently bearing a Zacks Industry Rank of 52, finds itself in the top 21% echelons of all 250+ industries.

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

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