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Should You Short This Right Now ? #SCCO


Should You Short This Right Now ? #SCCO   


 Portfolio Analysis 

  Southern Copper Corporation 

  SCCO #1


Name: Southern Copper Corporation 

Stock Exchange: NYSE-American 

Symbol: SCCO

Corporate Offices: 

1.USA- Arizona 

2. Mexico - Delegación Miguel Hidalgo

3. Peru - Santiago de Surco

Market Cap: 57.895 Billion Dollars 

  First and foremost, its important to note, that Southern Copper Corporation  is a company of a company of a company, in other words it has a unique corporate instruction. Mining Division of Grupo Mexico is represented by the subsidiary of America's Mining Corporation (AMC) in which the latter holds Southern Copper Corporation, Minera Mexico S.A. de C.V., Southern Peru Copper Corporation, Asareo L.L.C., Minera Los Frailes S.L.

   Moreover, SCCO, is involved in mining of different ores, the following is the sales value by product in 2019 copper: 81.5%, molybdenum: 7.7%, zinc: 3.9%, silver: 4.5%, sulfuric acid: 2.3%. Moreover, a 5 year span of financials from 2015 to 2019 is below. One thing to highlight two years of a net debt of 0 (2018 & 2019), cash and cash equivalents doubled from 2018 to 2019. Also, net sales have been increasing every year since 2015, along with the dividends.

http://www.southerncoppercorp.com/ENG/invrel/Pages/PGKeyfinancialdata.aspx
(In millions, except capital  stock and financial ratios).


Lets take a look at the stock prices and copper prices from 2003 -2021:




Observations (Red Circles) 

Relatively, the stock price is the highest it has ever been: $74.89( its peak was $81.53).

It corelates with copper prices. 

SCCO: The average 5 high prices starting from 2007 -2020  = $51.10.

SCCO: The average 4 low prices starting from 2007 -2020 = $19.50.

Copper: The average 5 high prices starting from 2007 -2020 = $3.81

Copper: The average 4 low prices starting from 2007 -2020 = $2.31

Since 2007, every low (highlighted in red) has been higher than the previous low:

 By About:

-$2 (2007-2011~4yrs), 

-$4 (2011-2016~4yrs), 

-$8 (2016-2020~4yrs), 

   

    This is not financial advice, but just looking at the historical data, it seems like this stock is due for another low. You know what they say what goes up must go down. Given the current financial situations, many people speculate another market crash and this stock is not immune. Though I am long-term bullish on copper, I would still bet on a short, and hope it cashes in, within about a years time. Based on averages and trends  As mentioned before the price is about the highest it has ever been compared to its past. Looking at the data, within 2-3 year span, if we see it drop to low 40's or high 30's, that might be a good chance to buy in, anything past high 60's or low 70's that might be a good chance to sell. But, as always, time will tell. 


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