Southern Copper – has 70 years of production ahead and a good dividend

Southern Copper Corp (NYSE:SCCO) is an interesting copper stock offering quality copper mining assets, low cost production, a dividend and a long mine life. Here is a stock analysis and investment thesis. Don’t forget to check my coppe investing thesis:

Copper Stock To Watch – Southern Copper – Dividend + 70 years of production ahead

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Transcript

Good afternoon fellow investors. A few weeks ago, I made a good video about copper being one of my best investment thesis, how I'm very bullish on copper of the next 510 years. I think it's cheap the economics, the difficulty of mining it it's getting harder and harder and how over the next 510 years the corporate price will go higher and therefore is why am I invested in and then I got a lot of females asking me Okay, so what is a good corporate company to buy?

Copper play

I have one I'm own owning one company that's a pure copper miner one is exposed to copper and other on a little bit, but I found one company that's a great company a great Copper Mine are the price is perhaps a little bit higher, but it is one to watch and one that I have put on my cover. stocks that I cover. Additionally, I have 30 companies that I cover, I look I adjust for earnings, and I wait for them those price to fit my entry points. That's what I do on my stock market research platform, you can check that out. Whenever you want. The link is in the description below.

All my research is less than $1 per day, so less less than a cup of coffee with me per day and you get everything that I do structured every trade everything. So check it out, when you get the time. Now let's go to Southern Copper Corp. It has all the qualities of a great business and all the qualities I look when I look at stocks, but then when it comes to investing, you also have to look at Okay, what's going on? What are the catalysts? what might happen when what might happen?

And what might impact the stock price? Will it be a better bargain in the future? And can I buy it at a discount at some point in time, which is something I think I can I might be able to do when you have 30 stocks. It's enough that three of those become a bargain in a year and you do really really well so it might it might not let me give you an overview of the company. Why I think it's a great business.

Valuation

What is the current valuation? What is the current expected return from my earnings model, and then you'll see how this fits your portfolio whether you want to cover it to follow it, put it on your watch list or whether you want just to follow what I do and have me cover it, follow earnings follow the industry, things that happen for you. Let's start. So Southern Copper Corporation, when I looked at last time, 2018 it was very expensive, but now the stock price is significantly down.

However, because of copper is down expected recession, everything. But when you look at such things, when you see great companies going down, then it's always good to check them out. So Southern Copper is a company that has mines, copper mines in Mexico and barrel, and they have very good minds and what I really like about them is that They have 70 years of mining ahead of them. There are a lot of mining companies that can mind for 510 years have good economics. But what's next what's after seven after the 10th year? Well, they don't have to worry at Southern Copper about that because they have great minds great assets, and they are a low cost producer.

Southern Copper producer advantages

With when it comes to mining, there are always issues mining is not nice, but it is necessary for the world we live in. So there are protests again against the 1.4 billion new copper project that they plan to do in pair room. This will delay things it has already been delayed for a decade, due to projects and we will see how that works out over the long term. But these projects are not everything that the company is the company is diversify the cross many projects and that's what actually makes it interesting and gives it the, as you can see, the cash cost is then very low. And this is another benefit on top of the 70 years of production.

So diversification with many projects and extremely low cash costs if you look at the cost curve for copper miners it is the lowest cost curve. In the world. Glencore is also low but Glencore has high debt attached to that mining then we have tech that is exposed to go violent, okay, low copper cost, but then iron ore bhp, differentiated, etc, etc. And then you have those very leveraged copper miners that if copper prices go down are in trouble but Southern Copper if copper prices go down, they will make 1,000,000,002 billion less, but they will unlike a go bust because of their low copper mining costs. So that is the second advantage on top of the 70 years of mining ahead. And then the third key compound.



About the Author

Jacob Wolinsky
Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Prior to ValueWalk, Jacob was VP of Business Development at SumZero. Prior to SumZero, Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and four kids in Passaic NJ. - Email: jacob(at)valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities anymore to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own a few grams of Gold and Silver