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  • Writer's pictureShernel Thielman

Unveiling Southern Copper: A Decade of Remarkable Growth

For most investors, tracking how a stock's price evolves over time is essential. Understanding price performance not only impacts investment portfolios but also facilitates comparisons across sectors and industries. Moreover, the fear of missing out (FOMO) often propels investors towards tech giants and popular consumer-facing stocks, seeking to capitalize on potential growth opportunities.

 

Consider Southern Copper (SCCO), a company that has experienced steady growth over the past decade. Delving into its business operations unveils a robust foundation built on mining, exploration, smelting, and refining copper and other minerals. Headquartered in Phoenix, Arizona, Southern Copper's operations span across Argentina, Chile, Ecuador, Mexico, and Peru.

 

Business Overview: Southern Copper boasts the largest copper reserves globally and operates world-class assets in investment-grade countries like Mexico and Peru. Its operations are segmented into Peruvian, Mexican open-pit, and Mexican underground operations, each contributing to the company's diversified revenue streams. Notably, the geographic breakdown of sales includes the Americas, Europe, and Asia, showcasing its global footprint.

 

Financial Performance: Approximately 80% of Southern Copper's revenue is derived from copper sales, with molybdenum, silver, and zinc also contributing significantly. A hypothetical $1000 investment made in May 2014 would have appreciated to $3,904.41 by May 23, 2024, marking a substantial gain of 290.44%. While this return excludes dividends, it underscores the impressive price appreciation witnessed over the past decade.

 

Comparative Analysis: In comparison, the S&P 500 gained 180.42%, and the price of gold rose by 76.55% during the same period. However, Southern Copper's outperformance highlights its resilience and potential for wealth generation over the long term.

 

Future Outlook: Looking ahead, analysts anticipate further upside for SCCO. With expectations of increased copper production and favorable metal prices, Southern Copper is well-positioned for growth. Factors such as China's output reduction plans, rising industrial activity, and demand for clean energy solutions bode well for the company's future prospects. Additionally, strategic investments in growth projects and cost-control measures are poised to enhance margins and drive shareholder value.

 

Investment Disclaimer: Investing involves risks, and past performance is not indicative of future results. Investors should conduct thorough research and consult with financial advisors before making investment decisions.

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