Southern Copper (SCCO) — Stock Analysis 2026 [4.1]

Analysis as of 23 August 2026. Price deck: base copper US$6.00/lb — the representative trailing average on the fixed US$4–8/lb grid — with every grid price run as a scenario (deep bear US$4.00 to deep bull US$8.00/lb) and analyst consensus n/d (no archived capture on or before 23 Aug 2026; Table 17 field 11) — no spot price. Market data: the NYSE close of 21 August 2026, US$216.00 a share, a price that implies copper at US$11.25/lb. Refreshed on each quarterly and annual report. Rating: ★★★★ Solid / Overvalued (wide band).

Southern Copper mines copper at almost no net cost: in the first half of 2026 its by-product credits more than covered the cash cost, leaving a net credit of US$0.03 a pound. The thesis in one line: a Solid, long-life copper producer whose share price, at US$216.00, already assumes copper at about US$11 a pound, nearly double its five-year high. Why now: the 2026 copper rally lifted the shares to about 32 times trailing earnings while a new chief executive settles in and Tia María is still being built. To compare it with every copper producer on cost and reserves, use Metal Pilot’s copper mining stock screener.

1. Snapshot & thesis

Figure 1. Southern Copper in numbers

Figure data: Table 1, which gives each tile’s source; NAV, fair value and the read per Section 7, the rating per Section 9.

Southern Copper Corporation (NYSE and Lima: SCCO) is a copper producer in the base-metals sector, with molybdenum, silver and zinc as by-products. It runs four open-pit complexes — Toquepala and Cuajone in Peru through its Peru Branch, Buenavista and La Caridad in Mexico through Minera México — plus the IMMSA underground unit, three reserve-backed projects (Tia María with La Tapada, El Pilar, El Arco) and two unapproved greenfield projects (Los Chancas, Michiquillay). Grupo México owns 88.9% of it. It reports in US dollars.

Table 1. Southern Copper in numbers

Source: Southern Copper 10-K and 10-Q filings; price per stockanalysis.com, NYSE close 21 August 2026. Listed: Public (NYSE: SCCO; Lima: SCCO).

Thesis in brief. Bull: 108,955.5 Mlb of reserves, four large integrated pits, a 52.2% operating margin and net debt of 0.38× EBITDA make this one of the strongest copper businesses listed; the pipeline could add 36,000 t/yr (El Pilar) soon and far more later. Bear: the price is already there — the blend is US$104.66, half the share price, and even the deep-bull blend at US$8.00/lb copper sits 32% below it; production is drifting lower on grade and the minority sits under an 88.9% parent. What tips it: only copper held above about US$11/lb closes the gap. Section 9 carries the full rating.

How to read this analysis: the statcards and Section 9 carry the verdict; Sections 2 to 6 the evidence; Section 7 the valuation.

2. Assets & operations

Southern Copper is a copper price trade with large by-product credits; the Copper — A Complete Market Guide covers the market, and this section the company.

2.1 Portfolio overview

Table 2. Asset base, sorted by contained copper reserve

Source: FY2025 10-K, Item 2 mine production (p.39) and reserves (p.42); Q2 2026 10-Q capital programs (p.47); segment lives per Section 7.

Notes to Table 2. 1. Reserves are S-K 1300 proven and probable at 31 December 2025, mill plus leach, at US$3.30/lb copper. 2. The mine lines sum to 1,800.6 Mlb of the 2,108.2 Mlb total mined; the filing does not allocate the balance by mine. 3. Unit cost is filed for the group only: US$0.58/lb net of by-products in 2025.

The four producing pits hold 89,681.4 Mlb, 82% of the reserve, and Buenavista alone 31%. Value splits almost evenly between the countries: the Mexican pits carry 43% of enterprise NAV and the Peruvian pits 41% (Section 7).

2.2 Revenue split

Figure 2. Net sales by metal, 2025

Figure data: FY2025 10-K MD&A, copper share (p.114) and the molybdenum, silver and zinc shares (p.100); other is derived as the balance.

Figure 3. Net sales by segment, 2025

Figure data: FY2025 10-K segment results (p.118–119) and statement of earnings (p.129); the IMMSA segment’s own sales are not in the source set, so its row is derived.

A quarter of sales is by-products, and they are what turn a US$2.17/lb cash cost into US$0.58/lb. The valuation’s first-half basis adds other cash items of US$0.58/lb to the US$2.30 cost and deducts the US$2.24 credit (molybdenum and silver at their decks): US$0.64/lb net, US$1.08/lb with sustaining capital.

2.3 Buenavista

Buenavista in Mexico, run by Minera México, is the largest mine: an 86,000 tpd original concentrator plus a 120,000 tpd second concentrator (2016). Reserves are 2,246.0 Mt of sulfides at 0.44% copper (21,715.4 Mlb) and 2,003.9 Mt of leach ore at 0.26% (11,694.7 Mlb), with a zinc plant reserve at 0.53% zinc. Mined copper fell 7.5% to 711.5 Mlb in 2025 (2024: 769.3). The only encumbrance is the Mexican mining royalty — no streams. The asset risk is that fall in volume.

2.4 Toquepala

Toquepala in Peru is owned and run by the Peru Branch: an open pit and two 60,000 tpd concentrators. Reserves are 1,740.3 Mt of mill ore at 0.53% copper (20,496.9 Mlb) and 2,632.6 Mt of leach ore at 0.16% (9,532.0 Mlb). It mined 495.8 Mlb in 2025, flat on 2024’s 496.4. It pays the Peruvian royalty — US$69.7 million for the group in the 2026 period. The asset risk is Peru’s fiscal regime.

2.5 Cuajone

Cuajone, also the Peru Branch’s, is a production-stage open pit with a 90,000 tpd concentrator. Reserves are 1,463.3 Mt of mill ore at 0.47% copper (15,295.3 Mlb) and 18.3 Mt of leach ore at 0.50% (203.1 Mlb). It mined 358.8 Mlb in 2025 (2024: 363.5), under the same Peruvian royalty. The asset risk is concentration: one concentrator carries the mine.

2.6 La Caridad

La Caridad, in Minera México, holds 1,899.3 Mt of mill ore at 0.22% copper (9,097.5 Mlb) and 325.3 Mt of leach ore at 0.17% (1,236.2 Mlb); the Pilares pit adds 22.3 Mt at 0.80% (395.2 Mlb) and 1.9 Mt of leach ore. It mined 212.0 Mlb in 2025 (2024: 206.6). At 0.22% its mill grade is the group’s lowest, so the asset risk is cost.

2.7 El Arco

El Arco in Baja California is a 1,230 Mt deposit at 0.40% copper. Its reserve is 1,229.5 Mt of mill ore (10,822.1 Mlb) and 140.5 Mt of leach ore (846.3 Mlb), with 70,464.9 koz of silver at 1.8 g/t and 5,584.8 koz of gold at 0.14 g/t. No construction decision, permit, budget or start date is filed, so remaining capital and first production are n/d. The asset risk is that it stays a reserve.

2.8 Tia María and the other projects

Tia María in Arequipa, Peru, with the La Tapada deposit, holds 223.8 Mt at 0.29% (1,412.5 Mlb) and 487.6 Mt at 0.41% (4,449.2 Mlb). Construction reached 42% at 30 June 2026, from 32.5% at the end of March; remaining capital, first production and ramp are not in the 2026 filings, and lawsuits tied to the project run back to 2015. El Pilar in Sonora, 45 km from Cananea, is a 317 Mt deposit at 0.25% copper for 36,000 t/yr of SX-EW cathode at a capital cost of US$551 million; its environmental permits are in hand and site works start in September 2026. Los Chancas in Apurímac (130,000 t/yr, US$2,600 million, guided for 2031) and Michiquillay in Cajamarca (2,288 Mt inferred at 0.43%, 225,000 t/yr, US$2.5 billion, guided for 2032) have no approvals. The IMMSA unit mined 22.5 Mlb of copper in 2025.

2.9 Production, reserves & costs

Group P&P copper is 31,184.9 Mlb proven and 77,770.6 Mlb probable — 108,955.5 Mlb in 14,751.7 Mt (S-K 1300, 31 December 2025, at US$3.30/lb copper and US$10.00/lb molybdenum), with 3,907.0 Mlb of molybdenum. Resources exclusive of reserves add 32,632.0 Mlb measured and indicated and 144,650.1 Mlb inferred. Mined copper was 2,008.4 Mlb in 2023, 2,147.0 in 2024 and 2,108.2 in 2025; the first half of 2026 fell 3.8% to 1,016.8 Mlb, and 2026 guidance is 917,000 t, raised from a 911,400 t plan that cited lower ore grades. Cash cost before by-products held at US$2.13–2.19/lb from 2023 to 2025 while the by-product credit rose from US$1.16 to US$1.59, cutting the net cost from US$1.03 to US$0.58.

Figure 4. Copper mined, 2023–2025 and 2026 guidance

Figure data: FY2025 10-K total mined copper (p.39), converted at 2,204.62 lb a tonne; 2026 guidance per the Q2 2026 10-Q (p.42).

2.10 Peer positioning

The peer set for every star in Section 9 is four listed copper producers, none in a pending deal, on each company’s latest filing.

Table 3. Peer positioning — quality metrics

Source: each company’s filing as named in the Basis column — Antofagasta, Ivanhoe Mines, First Quantum, Freeport-McMoRan. n/d: the line was not retrieved from the filing in the source set.

By volume Southern Copper is second to Freeport-McMoRan; its net cost is half Antofagasta’s. Peers’ reserve lives were not retrieved, so the reserve star rests on Southern Copper’s five decades.

3. Financials & balance sheet

Table 4. Five-year financial summary (US$ m unless stated)

Source: FY2025, FY2024 and FY2023 10-Ks statements of earnings, cash flows and equity and the MD&A; Q2 2026 10-Q (p.3–7); the Q4 2023, Q4 2024 and Q4 2025 results releases for Adjusted EBITDA.

Notes to Table 4. 1. EPS and shares for 2021–2022 are restated to the FY2025 basis (795.3 m); the FY2023 10-K prints US$4.39 and US$3.41 on 773.1 m shares, before the stock dividends. 2. Net debt is total debt less cash; leases enter only the H1 2026 figure, which is 30 June 2026 with leases, on 2025 Adjusted EBITDA of US$7,822.4 m. 2025 is long-term debt of US$6,750.7 m, no current portion (FY2025 10-K p.131), less cash of US$4,304.6 m; 2021 debt is not in the source set (the FY2022 10-K closes it); 2022–2024 use Adjusted EBITDA of US$5,349.2 m, US$5,029.5 m and US$6,406.1 m (Q4 2023 and Q4 2024 results releases, p.12). 3. Cash margin is net sales less cost of sales before depreciation; 2021–2022 cost of sales US$3,894.4 m and US$4,649.1 m (FY2023 10-K p.119). 4. The 2024 dividend is the audited US$2.10; the MD&A table prints US$2.50.

Figure 5. Free cash flow, 2021–2025 (US$ m)

Figure data: Table 4 — operating cash flow less capital expenditures.

Sales reached a record US$13,420.0 million in 2025 and the first half of 2026 ran 38.4% ahead; operating cash flow covered net income 1.1 times in 2025. Read the statements with the Commodity Financials — A Metrics Guide. Cost deck: no unit-cost guidance is published; the first half of 2026 ran at US$2.30/lb before by-products, the 2026 plan cites lower grades, and royalties — US$69.7 million in Peru and US$175.2 million in Mexico for the 2026 period — move with price. There is no tax-pool horizon: the US$2,379.9 million foreign tax credit carryforward is fully reserved, and the 2025 effective rate was 36.9%.

Balance sheet. At 30 June 2026 long-term debt was US$7,994.4 million and leases US$630.0 million against US$5,665.0 million of cash — net debt US$2,959.4 million, 0.38× 2025 EBITDA, and about 0.43× if copper fell to US$4.00/lb on the filed sensitivity of US$120.0 million of net earnings per US$0.10/lb. Liquidity is US$7,329.9 million with short-term investments. Filed maturities include US$1 billion of 5.625% notes due 2032 and the US$1,250 million of 5.350% notes due 2036 issued in June; the covenant asks EBITDA of at least 2.5× interest, against 20.2× in 2025. The rehabilitation provision is US$490.7 million. Hedging: none; only embedded derivatives on provisional sales.

Capital returns. Cash dividends were US$3.10 a share in 2025 and US$2.00 in the first half of 2026; July’s authorisation was US$1.10 plus 0.0120 shares a share. The US$3 billion buyback has been idle since 2016. There are 834,331,706 shares, basic equal to diluted.

4. Management, strategy & structure

4.1 Management & governance

Oscar González Rocha, chief executive, died in April 2026; the board named Leonardo Contreras Lerdo de Tejada interim chief executive from 16 April and confirmed him as chief executive on 23 April. Germán Larrea Mota-Velasco, 72, has chaired the board since December 1999, was chief executive until October 2004 and is chairman, president and chief executive of Grupo México. Raúl Jacob Ruisánchez, 67, is chief financial officer. Board size, independence and the full committee list sit in the proxy statement, outside the source set; the Audit Committee reviews material affiliate transactions. Related parties are material: Larrea-family entities owed US$122.5 million at 30 June 2026, and an affiliate, MGE, supplies Mexican power under a 2012 contract to 2032.

4.2 Strategy

The strategy is organic growth from the reserve base, funded from cash flow: a 2026 capital programme of US$1,925.5 million, up from US$1,325.3 million in 2025. Targets: El Pilar site works from September 2026, Tia María under construction, Los Chancas in 2031 and Michiquillay in 2032. Acquisitions are rare — Michiquillay was bought under a June 2018 contract. Cathode sells under contracts with Mitsui (from 2023) and Hartree Partners (two years from 2026).

4.3 Ownership & structure

Grupo México holds 88.9% through Americas Mining Corporation; the rest trades in New York and Lima. Mexico runs through Minera México, bought in 2005; Peru through the Peru Branch. There are no options, warrants or convertibles: 834,331,706 shares at 30 July 2026, against 884.6 million issued including treasury shares.

5. ESG & sustainability

Four people died at the operations in 2025 — three employees and a contractor — after one in 2024 and five in 2023; lost-time injuries fell 14%, and no frequency rate is published. Tailings follow the ICMM’s global standard, under an internal review committee formed in 2025. Climate reporting has followed TCFD since 2020, with SASB and Scope 1 and 2 targets (baseline not in the source set), and Climate Action 100+ has recognised it three years running. Over 70% of staff are hired locally, while Tia María’s lawsuits show the community question is unresolved.

6. Risks

Table 5. Risk register

Source: FY2025 10-K risk factors (p.20, p.27) and notes; Q2 2026 10-Q; Section 7. Likelihood and impact are the author’s 1–5 assessment.

Figure 6. Risk matrix — likelihood against impact

Figure data: Table 5; each point prints likelihood × impact.

The register is led by the price, not the mines. Section 7 prices the first four risks: copper through the US$4–8/lb grid, molybdenum and silver through their own price grids, the by-product credit through the 2025 bound, the multiples against their targets, and Peru and Mexico through the 2% premium in the rate. Tia María’s risk sits in its 0.75 stage factor. Safety is the one operating risk with a recent record against it: four deaths in 2025.

7. Valuation

Valuation as of 23 August 2026, in US dollars (Southern Copper’s reporting and trading currency) against the US$216.00 NYSE close of 21 August 2026. Horizon: spot fair value. Price deck: base copper US$6.00/lb — the representative of the trailing averages (3-month US$6.14, 6-month US$5.97 and 12-month US$5.48/lb, IMF monthly, to July 2026) on the fixed US$4–8/lb grid — with every grid price run as a scenario (deep bear US$4.00 to deep bull US$8.00/lb); molybdenum US$24/lb (3-month US$25.00, 6-month US$24.38, 12-month US$22.52/lb, BCRP Peru export price, five-year US$19.15) on its US$18–30/lb grid and silver US$70/oz (US$67.83, US$73.20 and US$64.53/oz, World Bank Pink Sheet, five-year US$33.46) on the fixed US$40–80/oz grid, each held across the copper columns (molybdenum 20.6% and silver 12.9% of enterprise NAV, co-products); zinc held at the first-half 2026 credit; analyst consensus n/d (no archived capture on or before 23 Aug 2026; Table 17 field 11) — no spot deck. Discount rate 10% real after-tax (the base-metal 8% plus a 2% jurisdiction premium).

Southern Copper is valued as a copper producer following the How to Value Commodity Stocks guide. Two producing segments carry the value on the 2026 guidance of 917,000 tonnes — the Peruvian open pits (Toquepala and Cuajone) and the Mexican open pits (Buenavista and La Caridad, with the IMMSA unit’s copper) — each run to its contained reserve, 42 to 48 years at the guided rate. Tia María, El Pilar and El Arco enter as development blocks at the producing value per pound of reserve times a stage factor, and resources beyond the reserves through one conversion row. Net asset value carries half the weight; EV/EBITDA and an FCF-yield build on the next twelve months carry the rest.

Enterprise NAV at the base deck is US$73.7 billion: the Peruvian pits US$29.6 billion, the Mexican pits US$32.2 billion, the three projects US$6.3 billion and the resource row US$5.6 billion. The bridge takes US$0.7 billion net — debt and leases less cash, short-term investments and working capital — for NAV of US$87.51 per share, a P/NAV of 2.47×. Molybdenum and silver are 21% and 13% of enterprise NAV, each on its own deck.

Three choices set the level. The rate is the base-metal 8% plus a 2% premium for Peru and Mexico: their country risk premiums average about 2.3%, so the premium sits at the top of the ★★★ band. The copper deck sits 38% above its five-year average of US$4.36/lb, so every anchor is held at mid-cycle and moved only by the scorecard drivers, +0.16. And the by-product credit is the first half’s US$2.33/lb rebuilt with molybdenum and silver on their own decks — US$2.24/lb at base, almost the whole US$2.30/lb cash cost; at 2025’s US$1.59/lb, NAV per share would be about 13% lower.

Table 6. Load-bearing inputs — the filed figures the valuation moves on (full source register: Table 20)

Source: the Southern Copper filings named in each row (full source register: Table 20); copper averages from the IMF monthly series (FRED PCOPPUSDM).

8. Near-term catalysts (1–3 years)

Table 18. Near-term catalysts

Source: Q2 2026 10-Q MD&A (p.42, p.47); Q2 2026 results release (p.2); FY2025 10-K (p.100). Timing is company guidance, not a guarantee.

El Pilar is the only new volume inside three years, and it is small: 36,000 t/yr against 917,000 t guided for 2026. Tia María has no filed completion date, and Los Chancas and Michiquillay sit beyond the window. So the catalysts sustain the business; none closes the gap between the blend and the price.

9. Rating & verdict

Southern Copper is scored as a copper producer against Antofagasta, Ivanhoe Mines, First Quantum and Freeport-McMoRan (Section 2.10). Asset quality, cost, reserves, balance sheet and capital allocation carry 15% each; the other four 6.25% each; no dimension is not applicable.

Table 19. Scorecard rationale

Source: each row’s filing and page as cited; peers as declared in Section 2.10; Damodaran country risk premiums, 5 January 2026. Rows by weight, then dimension number.

Weighted average: 0.15 × 5 + 0.15 × 5 + 0.15 × 5 + 0.15 × 4 + 0.15 × 4 + 0.0625 × 4 + 0.0625 × 3 + 0.0625 × 2 + 0.0625 × 2 = 0.75 + 0.75 + 0.75 + 0.60 + 0.60 + 0.25 + 0.1875 + 0.125 + 0.125 = 4.14/5 (4.1 to one decimal) → ★★★★, Solid.

The two-axis verdict. As of 23 August 2026, quality ★★★★ Solid; value read Overvalued (wide band) — a blended fair value of US$104.66 against US$216.00, implied −51.5%; verdict: Full. At US$216.00 the market is pricing copper at about US$11.25/lb on the held blend, against a five-year range of US$3.42–6.15/lb. The target multiples — 1.16× P/NAV, 8.1× EV/EBITDA and a 6.0% FCF yield — carry Dims 1, 2 and 3 at +0.04 each and Dims 5 and 6 at +0.02 each.

The bull case is a business with few equals: reserves for five decades, a cost near zero after credits and a balance sheet that funds the pipeline. The bear case is the price: even at US$8.00/lb copper the blend is US$147.10, 32% below the share price, and the minority holds 11% under a controlling parent. What tips it is copper staying near US$11/lb, more than the grid’s top price. To rank it against every copper producer on the same dimensions, screen the sector on Metal Pilot’s copper mining stock screener.

10. Sources, methodology & disclaimer

10.1 Sources, methodology & data vintage

Company filings: Southern Copper’s FY2025, FY2024 and FY2023 10-Ks and the 2023–2024 technical report summaries; its Q1 and Q2 2026 10-Qs; the Q4 2025, Q1 2026 and Q2 2026 results releases and the 8-Ks of 13, 17 and 29 April 2026. Peer filings: as listed under Table 3. Market data: the NYSE close of 21 August 2026 (stockanalysis.com); the IMF copper series (FRED PCOPPUSDM); the molybdenum export price (BCRP series PN38805BM); the silver price (World Bank Pink Sheet); country risk premiums (Damodaran, 5 January 2026).

Methodology. Fundamentals to 30 June 2026, reserves at 31 December 2025, market data at 21 August 2026; data as of 23 August 2026, refreshed on each quarterly and annual report. Base deck copper US$6.00/lb on the fixed US$4–8/lb grid, every price run as a scenario; molybdenum US$24/lb and silver US$70/oz on their own trailing averages, zinc held at the first-half 2026 credit; 10% real after-tax (8% plus a 2% jurisdiction premium). Weights NAV 50%, EV/EBITDA 30%, FCF yield 20%; scorecard against Antofagasta, Ivanhoe Mines, First Quantum and Freeport-McMoRan on each company’s latest filing. Result: blended fair value US$104.66 and NAV US$87.51 per share against US$216.00, implied −51.5%, read Overvalued (wide band), market-implied copper deck US$11.25/lb.

Re-run log. 19 October 2026: reworked to the current template and re-modelled — price US$216.00, the 21 August close (the US$198.73 printed before was the 20 August close); base deck US$6.00/lb (was US$4.00); rate 10% (was 9%); rating 4.1/5 Solid (was 4.3/5 High quality); blended fair value US$108.18, implied −49.9%; read Overvalued (wide band), unchanged. 19 October 2026, fixes after the pre-launch gate: the Peruvian special mining tax (US$86.3 m in the first half) added to the Peru rows and the income-tax balances itemised inside the working-capital line; NAV/share US$90.99 → US$89.27, blend US$108.18 → US$106.70, implied −49.9% → −50.6%; read unchanged, Overvalued (wide band). 19 October 2026, second fix round: molybdenum (US$24/lb) and silver (US$70/oz) decked on their own trailing averages in place of the held first-half credit, and Table 4 completed for 2021–2024; NAV/share US$89.27 → US$87.51, blend US$106.70 → US$104.66, implied −50.6% → −51.5%; read unchanged, Overvalued (wide band).

Omitted figures and gaps. No asset map is built. Figure 3 splits revenue by segment, with IMMSA and eliminations as the balance, because no revenue by mine is filed; no safety-trend figure is built because no frequency rate is filed. Not in the source set: the 2026 proxy statement (board, committees, holders above 5%), the FY2022 10-K (2021 debt), Tia María’s budget and first-production date, peers’ cost and reserve-life lines, and an archived price series (own multiple history, consensus). Table 17’s gap register bounds each valuation gap. The P/NAV map, deck sensitivity and cross-checks are in the model’s out file, claude/valuation-models/southern-copper-scco.out.md. Table 6 opens Section 7; the register below closes this section.

Table 20. Full source register — every input the valuation uses (load-bearing inputs: Table 6)

Source: the Southern Copper filings and the market series named in each row (FRED PCOPPUSDM); load-bearing inputs: Table 6.

Provenance: Southern Copper Corporation — Form 10-K (Annual Report) — 2025.

10.2 Disclaimer & disclosure

This analysis is for information only and is not investment advice, a recommendation or an offer to buy or sell any security. It is a point-in-time snapshot as of 23 August 2026: the share price, market capitalisation, multiples and the value read all move. Reserve, resource and guidance figures are estimates on the bases stated; the valuation is an author-built model, not company figures, and the Quality × Value verdict is an analytical read, never an instruction. It was prepared with AI assistance from primary filings; verify every figure against the original documents. The author holds no position in Southern Copper or any company named here.