Investing in Southern Copper (SCCO) and the Future of Copper
In April, we highlighted the breakout in Southern Copper (SCCO) stock from $116 a share, which rose to $129.80 before coming back to the breakout level. The question now is whether it can hold that support and make another move towards new highs. But before diving into SCCO’s specific analysis, let’s first explore the underlying base metal itself.
Copper, an essential input for the shift to clean energy, is used in batteries, solar systems, wind turbines, and more. With the ongoing push for clean energy and the rise of artificial intelligence, copper demand is projected to reach 40 million metric tons in the next 15 years. Despite some setbacks, such as China’s economic slowdown affecting demand, the overall outlook for copper remains robust.
Technically, the price of copper broke out from a consolidation pattern in 2022 and reached a high of $5.21 before pulling back. Currently, we are seeing potential support levels between $4.54-$4.39, indicating a possible rebound for copper prices.
As for SCCO, the stock is also experiencing a similar correction and is expected to find support in the $115-$105 range. Southern Copper surpassed earnings estimates for Q1 and is projected to continue growing in the coming years. Earnings are forecasted to increase by 27.55% in 2024 and by 19.33% in 2025.
The key to successful investing lies in aligning technical analysis with fundamental data. At Inside Edge Capital, we believe in making well-informed investment decisions based on a combination of technical and fundamental factors.
As the founder of Inside Edge Capital, LLC, I closely monitor SCCO and believe in its potential for growth. I have personal stakes in SCCO and include it in our wealth management company’s portfolio. Charts shown are generated using MotiveWave software.
Disclaimer: The information provided is for informational purposes only and should not be considered as financial, investment, tax, or legal advice. Individual circumstances may vary, so it’s advisable to consult with a financial advisor before making any investment decisions. Please read our full disclaimer for more information.
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