Research · Sep 3, 2026
[SCCO] Southern Copper Thesis 2026: Buenavista Expansion Compounds Low-Cost Copper Optionality
Southern Copper FY2025 revenue ~$11.85B with adj. EBITDA ~$5.95B at ~50% margin as copper production reached ~985K tonnes at industry-leading $1.30/lb cash cost. LME copper averaged ~$4.45/lb (vs ~$3.85/lb FY2023 trough). Each $0.10/lb copper price = ~$110M EBITDA leverage. FY2026 thesis: Buenavista zinc concentrator (commissioning FY2026) adds copper + zinc capacity; structural copper deficit narrative (EV adoption, grid electrification, AI data center electrical infrastructure outpacing primary supply growth) supports $4.50-5.00/lb sustained pricing; dividend ~80% of distributable earnings = direct copper price exposure for income; Grupo Mexico controlling shareholder limits free float.