Southern Copper (SCCO) shares jumped 6.2% in the last trading session, closing at $170.52. This rise came with higher trading volumes than usual. In the past month, the stock has gained 8.8%. The increase in Southern Copper’s shares is mainly due to rising copper prices. Copper prices have surged by 39.2% over the last year, now close to a record high of $6 per pound. This is driven by concerns about supply shortages. Expectations for more rate cuts and policy changes in China are also boosting copper’s appeal. Southern Copper is expected to report quarterly earnings of $1.46 per share, which is a 44.6% increase compared to last year. Revenues are projected to reach $3.62 billion, up 30.1% from the same quarter last year. Research shows a strong link between changes in earnings estimates and stock price movements. For Southern Copper, the consensus earnings per share (EPS) estimate has been increased by 17.2% in the past month. A positive trend in earnings estimates often leads to higher stock prices. Southern Copper is part of the Zacks Mining – Non Ferrous industry, along with First Quantum Minerals (FQVLF). FQVLF also saw gains, ending 4.2% higher at $28.52, resulting in an 11.5% return over the month. Southern Copper is sending strong bullish signals, driven by rising copper prices. These prices are nearing $6 per pound, supported by expectations of interest rate cuts from the Federal Reserve and ongoing stimulus efforts in China. Recent data showed modest manufacturing growth in China, with a PMI of 50.8 in December 2025. The high trading volume during SCCO’s recent jump suggests strong investor confidence. The significant 17.2% increase in quarterly earnings estimates for SCCO is crucial. This strong fundamental growth differs from peers like First Quantum Minerals, which have flat estimates, highlighting Southern Copper’s potential for outperformance. Traders looking to capitalize on expected price increases ahead of the earnings report might consider buying call options or using bull call spreads. However, implied volatility may be high due to the recent price spike and the upcoming earnings date. In similar situations from 2025, we found that selling premium can be a wise move when implied volatility is high. Traders confident in the stock’s direction may want to consider selling cash-secured puts at a price where they would be okay owning the shares. Supply-side issues remain a vital factor for the copper market, as we’ve learned over the past few years. Recent data shows global copper inventories are at multi-year lows. Ongoing labor negotiations at major mines in South America mean any further disruptions could drive prices even higher. This creates a supportive environment for long positions in copper producers like SCCO.

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