Southern Copper Corp. : SCCO-US: Dividend Analysis : May 17th, 2017 (record date) : By the numbers : May 19, 2017

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Our analysis is based on comparing Southern Copper Corp. with the following peers – Freeport-McMoRan, Inc., Grupo Mexico S.A.B. de C.V. Class B, Lundin Mining Corporation, Teck Resources Limited Class B, Sociedad Minera Cerro Verde SAA, First Quantum Minerals Ltd., BHP Billiton Limited Sponsored ADR, Rio Tinto plc Sponsored ADR, BHP Billiton Plc Sponsored ADR and Compania de Minas Buenaventura SAA (FCX-US, GMBXF-US, LUNMF-US, TECK-US, CVERDEC1-PE, FM-CA, BHP-US, RIO-US, BBL-US and BUENAVC1-PE).

Southern Copper Corp.’s dividend yield is 0.89 percent and its dividend payout is 19.49 percent. This compares to a peer median dividend yield of 0.80 percent and a payout level of 1.36 percent. This type of dividend performance might make it a good stock for dividend investors. In addition, the company’s relatively good dividend quality score of 83 out of a possible score of 100 points to some sustainability of its robust payout ratio, and underscores its attractiveness for dividend investors seeking current income.

Dividend Yield
Dividend Quality Score

Dividend Quality Overview

  • Over the last twelve months (prior to March 31, 2017), SCCO-US paid a high quality dividend, which represents a yield of 0.68% at the current price.
  • Dividend quality trend has not been consistent over the last five years. Dividends were paid during each of these years — of these 1 was high quality, 2 were medium quality and 2 were low quality.
  • The ending cash balance, with a dividend coverage of 4.22x, provides a substantial cushion in case of a significant reduction of cash flows in the future.
Dividend Quality Score Vs Dividend Yield

Quadrant label definitions. Hover to know more

High Score;High Yield, High Score;Low Yield, Low Score;Low Yield, Low Score;High Yield

Dividend Coverage

Over the last twelve months (prior to March 31, 2017), SCCO-US paid a high quality dividend.

The source of the company’s cash to support the dividend paid over the last twelve months is operating cash flow (coverage of 7.58x), investing cash flow (coverage of -4.48x), issuance cash flow (coverage of -0.10x) and twelve-month prior cash (coverage of 3.73x), for a total dividend coverage of 5.22x.

SCCO-US‘s issuance cash flow includes outflows from net share buybacks (coverage of -0.10x). Thus, the total coverage including share buybacks is 5.32x, which reflects our assumption that the cash paid for share buybacks is discretionary and could instead be used to pay dividends.

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These coverage ratio factors imply that the firm’s dividends are wholly paid from operating and investing cash flows net of any debt repayments, which suggests a high dividend quality.

Dividend History

Item 2012-12-31 2013-12-31 2014-12-31 2015-12-31 2016-12-31 Latest
Dividend Yield (%) 9.81 2.39 1.66 1.34 0.56 0.89
Dividend Payout (%) 162.72 35.42 28.57 36.56 18 19.49

A complete list of metrics and analysis is available on the company page.

Company Profile

Southern Copper Corp. engages in the development and exploration of mineral properties. It operates through the segments: Mexican Open-Pit; Mexican IMMSA Unit; Peruvian Operations; and Corporate and Other. The Mexican Open-Pit segment manages mines and processes anodes and copper. The Mexican IMMSA Unit segment operates underground coal mines. The Peruvian Operations segment includes open-pit mines in Peru. The Corporate and Other segment consists of the firm’s administrative activities. The company was founded on December 12, 1952 and is headquartered in Phoenix, AZ.

Disclaimer

The information presented in this report has been obtained from sources deemed to be reliable, but AnalytixInsight does not make any representation about the accuracy, completeness, or timeliness of this information. This report was produced by AnalytixInsight for informational purposes only and nothing contained herein should be construed as an offer to buy or sell or as a solicitation of an offer to buy or sell any security or derivative instrument. This report is current only as of the date that it was published and the opinions, estimates, ratings and other information may change without notice or publication. Past performance is no guarantee of future results. Prior to making an investment or other financial decision, please consult with your financial, legal and tax advisors. AnalytixInsight shall not be liable for any party’s use of this report. AnalytixInsight is not a broker-dealer and does not buy, sell, maintain a position, or make a market in any security referred to herein. One of the principal tenets for us at AnalytixInsight is that the best person to handle your finances is you. By your use of our services or by reading any our reports, you’re agreeing that you bear responsibility for your own investment research and investment decisions. You also agree that AnalytixInsight, its directors, its employees, and its agents will not be liable for any investment decision made or action taken by you and others based on news, information, opinion, or any other material generated by us and/or published through our services. For a complete copy of our disclaimer, please visit our website www.analytixinsight.com.

 





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