Traders Buy Large Volume of Put Options on Southern Copper (NYSE:SCCO)

Southern Copper Corporation (NYSE:SCCO) was the target of unusually large options trading activity on Friday. Stock investors bought 10,968 put options on the company. This is an increase of approximately 68% compared to the typical daily volume of 6,520 put options.

Key Stories Impacting Southern Copper

Here are the key news stories impacting Southern Copper this week:

• Positive Sentiment: Quarterly dividend announced — SCCO declared a $1.00 quarterly dividend (annualized yield ~2.2%). Record date is May 13 and payment date is May 29; that steady cash return is a supportive factor for income-minded investors.
• Neutral Sentiment: News about a different, similarly named company (Great Southern Copper PLC) raising funds via warrants — not the same issuer as SCCO, so unlikely to materially affect Southern Copper’s fundamentals. Great Southern Copper Raises Funds via Warrant Exercise and Increases Share Capital
• Negative Sentiment: Leadership uncertainty after the sudden death of the CEO — multiple outlets flag management transition risk and investor concern that the firm faces an earnings/operational test during the change, a direct driver of today’s downside pressure. Why Southern Copper (SCCO) Is Down 5.1% After Sudden CEO Death And Leadership Uncertainty Southern Copper faces earnings test amid leadership transition
• Negative Sentiment: Unusually large put-option buying — investors purchased ~10,968 put contracts (≈68% above typical put volume), signaling elevated bearish positioning or hedging activity that can amplify downward price moves.
• Negative Sentiment: Analyst sentiment is weak: SCCO’s consensus is around a “Reduce”/average reduce rating and Scotiabank’s recent note raised its price target to $133 but maintained a “sector underperform” rating (target still well below the current share price), reinforcing downside expectations. Southern Copper Corporation (NYSE:SCCO) Given Average Rating of “Reduce” by Analysts Scotiabank raises price target to $133 (Benzinga)
• Negative Sentiment: Critical equity research and commentary highlight valuation risk — recent pieces argue SCCO is an expensive copper exposure that cannot afford operational missteps, increasing sensitivity to the current leadership and earnings risk. Southern Copper: An Expensive Copper Story That Cannot Afford A Misstep

Southern Copper Price Performance

Southern Copper stock opened at $180.96 on Friday. The company’s fifty day moving average price is $185.81 and its 200 day moving average price is $163.20. The company has a debt-to-equity ratio of 0.61, a quick ratio of 3.40 and a current ratio of 3.89. The stock has a market capitalization of $148.22 billion, a P/E ratio of 34.01, a P/E/G ratio of 1.83 and a beta of 1.16. Southern Copper has a 1 year low of $86.59 and a 1 year high of $223.88.

Southern Copper’s stock is going to split on Wednesday, May 13th. The 1.01-1 split was recently announced. The newly created shares will be issued to shareholders after the market closes on Tuesday, May 12th.

Southern Copper (NYSE:SCCO) last announced its quarterly earnings data on Wednesday, January 28th. The basic materials company reported $1.55 earnings per share for the quarter, beating analysts’ consensus estimates of $1.54 by $0.01. The company had revenue of $3.87 billion for the quarter, compared to analyst estimates of $3.73 billion. Southern Copper had a return on equity of 41.97% and a net margin of 32.30%.During the same quarter last year, the firm posted $0.98 EPS. As a group, equities research analysts anticipate that Southern Copper will post 6.79 earnings per share for the current fiscal year.

Southern Copper Dividend Announcement

The company also recently disclosed a quarterly dividend, which will be paid on Friday, May 29th. Shareholders of record on Wednesday, May 13th will be issued a $1.00 dividend. The ex-dividend date is Wednesday, May 13th. This represents a $4.00 dividend on an annualized basis and a yield of 2.2%. Southern Copper’s dividend payout ratio (DPR) is presently 75.19%.

Insider Buying and Selling

In other news, Director Lerdo De Tejada Leon Contreras sold 9,326 shares of the firm’s stock in a transaction that occurred on Tuesday, February 3rd. The shares were sold at an average price of $209.56, for a total transaction of $1,954,344.91. Following the sale, the director owned 605 shares of the company’s stock, valued at $126,783.04. This trade represents a 93.91% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. Also, Director Bonilla Luis Miguel Palomino sold 193 shares of the firm’s stock in a transaction that occurred on Friday, March 13th. The stock was sold at an average price of $174.60, for a total transaction of $33,697.80. Following the sale, the director directly owned 1,707 shares in the company, valued at $298,042.20. The trade was a 10.16% decrease in their position. The SEC filing for this sale provides additional information. Insiders have sold a total of 9,526 shares of company stock worth $1,989,373 in the last ninety days. Corporate insiders own 0.07% of the company’s stock.

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in SCCO. Hopwood Financial Services Inc. purchased a new position in Southern Copper in the 3rd quarter valued at $25,000. SHP Wealth Management purchased a new position in Southern Copper in the 4th quarter valued at $25,000. Lloyd Advisory Services LLC. purchased a new position in Southern Copper in the 4th quarter valued at $29,000. Virtus Advisers LLC purchased a new position in Southern Copper in the 4th quarter valued at $29,000. Finally, United Community Bank purchased a new position in Southern Copper in the 3rd quarter valued at $30,000. Hedge funds and other institutional investors own 7.94% of the company’s stock.

Analysts Set New Price Targets

A number of equities research analysts have recently commented on the stock. UBS Group dropped their price objective on shares of Southern Copper from $150.00 to $140.00 and set a “sell” rating on the stock in a research note on Friday, March 27th. Morgan Stanley raised their price objective on shares of Southern Copper from $155.00 to $160.00 and gave the stock an “underweight” rating in a research note on Thursday, April 9th. JPMorgan Chase & Co. lifted their price target on shares of Southern Copper from $117.50 to $127.00 and gave the company an “underweight” rating in a research note on Friday, April 10th. The Goldman Sachs Group raised shares of Southern Copper from a “sell” rating to a “neutral” rating and set a $178.00 price target on the stock in a research note on Friday, April 10th. Finally, Wells Fargo & Company set a $186.00 price target on shares of Southern Copper and gave the company an “equal weight” rating in a research note on Wednesday, April 15th. Two investment analysts have rated the stock with a Buy rating, four have given a Hold rating and seven have given a Sell rating to the company. Based on data from MarketBeat, the stock currently has an average rating of “Reduce” and a consensus price target of $145.61.

About Southern Copper

Southern Copper Corporation (NYSE: SCCO) is a large, integrated copper producer whose operations span the full value chain from exploration and mining to smelting, refining and the sale of copper and other metal products. The company produces a range of copper products including copper concentrate and refined cathodes, and recovers valuable byproducts such as molybdenum, silver and zinc. Southern Copper concentrates on high-volume, long-life assets designed to support steady production and processing capabilities.

Southern Copper’s operations are concentrated in Peru and Mexico, where it owns and operates multiple large-scale mining and processing facilities.