Southern Copper Corporation Common Stock (SCCO)

FairStock Score: 72/100 — STEADY

Key Financials

Strengths

• Generates $3.3 billion in annual free cash flow (2.2% yield on market cap)
• Strong Piotroski F-Score of 7/9 indicating robust financial health across profitability, leverage, and efficiency metrics
• High return on equity of 42.8% demonstrating efficient capital deployment
• Altman Z-Score of 10.0 confirms minimal bankruptcy risk and strong solvency
• Revenue growth of 39.0% demonstrates strong top-line momentum

Concerns

• Trades significantly above Graham Number ($40) with negative 362% margin of safety—limited downside protection

AI Analysis

Southern Copper Corporation Common Stock is a large-cap basic materials company valued at $150.9 billion. The business generates $13.4 billion in annual revenue with a 9.7% net margin and $3.3 billion in free cash flow. From a quality standpoint, Southern shows solid Piotroski F-Score of 7/9 and Altman Z-Score of 10.0 confirms fortress-level solvency. On valuation, the stock is trading at a premium 35.0x earnings, with trades far above its Graham Number ($40) with no margin of safety. Growth dynamics show revenue growing at 39.0% and profit growth of 64.7%. The 2.1% dividend yield adds an income component for patient holders. Our composite FairStock Score of 68/100 reflects above-average fundamentals overall. The premium valuation demands continued execution and leaves limited room for disappointment.

Bull Case

Southern's 39% revenue growth trajectory could accelerate as it captures additional market share in the basic materials sector. With $3.3 billion in annual free cash flow (2.2% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

At 35x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer