Analyst Carlos De Alba from Morgan Stanley maintained a Hold rating on Southern Copper (SCCO – Research Report) and increased the price target to $102.00 from $101.26.
Carlos De Alba has given his Hold rating due to a combination of factors affecting Southern Copper’s operations and market exposure. The company’s Ilo smelter in Peru has been functioning at full capacity despite experiencing minor operational issues, which indicates a stable production environment. However, the upcoming scheduled maintenance in June could potentially impact operations, adding an element of uncertainty.
Additionally, while Southern Copper’s mining operations in Peru and Mexico are running smoothly, the company’s significant exposure to the COMEX copper price poses a risk. Approximately 40% of its copper volumes are priced at COMEX, which could be affected by fluctuations in the market. This exposure, combined with potential import tariffs on copper exports to the US, adds to the cautious outlook, justifying the Hold rating.
Based on the recent corporate insider activity of 44 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of SCCO in relation to earlier this year.