Dividend Yield: 9%
An integrated copper producer that also produces zinc and silver, Southern Copper (NYSE:SCCO) maintains smelting and refining facilities in Peru and Mexico, and conducts exploration in both, in addition to Argentina, Chile and Ecuador.
As the precious metals market goes, so goes Southern Copper, and at least to this point, it’s going quite well. SCCO generates over $6 billion in revenue annually, with over $1 billion of that finding its way to the bottom line. Earnings per share over the next five years are expected to grow nearly 10%, according to FINVIZ. With its net profit margin sneaking up toward the 30% range, Southern proves it knows how to manage costs in a difficult sector.
And nobody will argue with a 92.75 cents per quarter per share dividend, and SCCO has paid a steady, if somewhat fluctuating, dividend since 1996. Looking through charts comparing quarterly net income with quarterly payouts suggests the two are correlated both up and down. So, caution is warrented regarding SCCO’s ability to raise dividends consistently.
Still, if the metals market works in your favor, SCCO could be a very nice play. Of course, I don’t like to play the “if,” so I’d be cautious.