Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

Equity, Bottom-up Analyst

Investics Research

It is important to note that the information provided by Investics Research is based on publicly available data and own knowledge, which has been gathered and analyzed from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions. All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include but are not limited to, company announcements, exchange filings, presentations, etc. Investics does not guarantee the accuracy and completeness of the forecasts, estimates, and/or other information.

Equity Bottom-up Research

Equity Bottom-Up

<ul>
<li>Copper rebounded last week, rising 4% on the LME and 6% on the COMEX, led by improved sentiment but in line with most of its commodity complex peers.</li>
<li>Check out our initiation, <a href="https://www.smartkarma.com/insights/copper-primer-what-we-like-about-copper-and-what-to-play" target="_blank" data-smartkarma-citation="insights:141017" rel="noopener">Copper Primer: What We Like About Copper and What to Play</a>, and our equity initiation, <a href="https://www.smartkarma.com/insights/southern-copper-in-a-league-of-its-own" target="_blank" data-smartkarma-citation="insights:139839" rel="noopener">Southern Copper: In a League of Its Own</a>. </li>
<li>We provide updates on the long copper-short gold trade we explored last week and the iron condor in <a href="https://www.smartkarma.com/entities/freeport-mcmoran-inc" target="_blank" data-smartkarma-citation="entities:12491:1" rel="noopener">Freeport Mcmoran (FCX US)</a> </li>
</ul>


Copper rebounded last week, rising 4% on the LME and 6% on the COMEX, led by improved sentiment but in line with most of its commodity complex peers.
Check out our initiation, Copper Primer: What We Like About Copper and What to Play, and our equity initiation, Southern Copper: In a League of Its Own. 
We provide updates on the long copper-short gold trade we explored last week and the iron condor in Freeport Mcmoran (FCX US) 


Copper Tracker July 2024: Physical/​Equity Screens And Trades

<ul>
<li>
<a href="https://www.smartkarma.com/entities/southern-copper-corp" target="_blank" data-smartkarma-citation="entities:16279:1" rel="noopener">Southern Copper (SCCO US)</a> in the equity space is the best way to play bullish copper long-term with its long-term (10-year) ROCE of &gt;22% </li>
<li>With low-cost production assets in Peru and Mexico, the company has managed EBITDA margins of&gt; 39% across the cycle (last 15 years) and averaging 50%.</li>
<li>A 100% payout results in a dividend yield of 3.5%. We believe there is a price for everything, and in the event of a 20% correction, it would be attractive.</li>
</ul>



Southern Copper (SCCO US) in the equity space is the best way to play bullish copper long-term with its long-term (10-year) ROCE of &gt;22% 
With low-cost production assets in Peru and Mexico, the company has managed EBITDA margins of&gt; 39% across the cycle (last 15 years) and averaging 50%.
A 100% payout results in a dividend yield of 3.5%. We believe there is a price for everything, and in the event of a 20% correction, it would be attractive.


<ul>
<li>Top miners like <a href="https://www.smartkarma.com/entities/bhp-group-ltd" target="_blank" data-smartkarma-citation="entities:147:1" rel="noopener">BHP Group Ltd (BHP AU)</a> and <a href="https://www.smartkarma.com/entities/teck-resources-ltd-36dbdad5-1430-4d7a-8578-31bc50086f72" target="_blank" data-smartkarma-citation="entities:33343:1" rel="noopener">Teck Resources (TECK US)</a> are signaling their long-term bullish copper intent through their recent corporate actions. </li>
<li>Copper may experience short periods of oversupply, but its long-term outlook makes it one of the best commodities we cover in terms of return potential. </li>
<li>Our best plays in the copper space are <a href="https://www.smartkarma.com/entities/southern-copper-corp" target="_blank" data-smartkarma-citation="entities:16279:1" rel="noopener">Southern Copper (SCCO US)</a>, <a href="https://www.smartkarma.com/entities/teck-resources-ltd-36dbdad5-1430-4d7a-8578-31bc50086f72" target="_blank" data-smartkarma-citation="entities:33343:1" rel="noopener">Teck Resources (TECK US)</a> and <a href="https://www.smartkarma.com/entities/freeport-mcmoran-inc" target="_blank" data-smartkarma-citation="entities:12491:1" rel="noopener">Freeport Mcmoran (FCX US)</a>
</li>
</ul>


Top miners like BHP Group Ltd (BHP AU) and Teck Resources (TECK US) are signaling their long-term bullish copper intent through their recent corporate actions. 
Copper may experience short periods of oversupply, but its long-term outlook makes it one of the best commodities we cover in terms of return potential. 
Our best plays in the copper space are Southern Copper (SCCO US), Teck Resources (TECK US) and Freeport Mcmoran (FCX US)



Copper Primer: What We Like About Copper And What to Play

Asia L/S Equity PM/Macro/Thematic Idea Generation

Rikki Malik

<ul>
<li>Increased demand from power plants under construction outside  G-7 countries</li>
<li>There is constrained supply as with many other fossil fuels</li>
<li>We look at a basket of coal stocks with good balance sheets and increasing production</li>
</ul>


Increased demand from power plants under construction outside  G-7 countries
There is constrained supply as with many other fossil fuels
We look at a basket of coal stocks with good balance sheets and increasing production


Coal Is Back - The Real Inconvenient Truth

<ul>
<li>Company Forecasts extremely conservative at current and expected metal prices</li>
<li>Scarcity Value for a liquid, large-cap gold miner in Japan</li>
<li>Balance Sheet will allow future share buybacks and dividend in the harvesting phase</li>
</ul>


Company Forecasts extremely conservative at current and expected metal prices
Scarcity Value for a liquid, large-cap gold miner in Japan
Balance Sheet will allow future share buybacks and dividend in the harvesting phase


Sumitomo Metal Mining -  A Shiny Mix of Gold, Copper and Nickel

Canada

Teck Resources Ltd. is an integrated natural resource group with activities in mining, smelting, and refining.  The Company mines zinc, copper, molybdenum, gold, and metallurgical coal in the United States, Canada, Peru, and Chile. Teck also produces refined metals, specialized metal products, and other products.

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Teck Resources (TECK US)

Copper Tracker July 2024: Physical/Equity Screens And Trades

This brief insight summarizes Copper's performance and equities on our screens. We highlight our research and trades to explore for July

Sameer Taneja

Southern Copper: In a League of Its Own

We initiate on Southern Copper (SCCO US), a high-quality copper play with assets in Peru and Mexico. Its long term ROCE >22% makes its a very...

Sameer Taneja

Copper Primer: What We Like About Copper And What to Play

We initiate with a primer on the copper sector. We elaborate on our fundamental rationale for being bullish on the metal and discuss different ways...

Sameer Taneja

Coal Is Back - The Real Inconvenient Truth

Growing demand for coal outside of G-7 countries is putting pressure on already limited supply, leading to opportunities in coal stocks with...

Rikki Malik

Sumitomo Metal Mining - A Shiny Mix of Gold, Copper and Nickel

This miner has extremely conservative forecasts, some scarcity value, and a strong balance sheet for potential future buybacks and dividends.

Rikki Malik

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Copper Tracker July 2024: Physical/​Equity Screens And Trades

This brief insight summarizes Copper's performance and equities on our screens. We highlight our research and trades to explore for July

Sameer Taneja

Southern Copper: In a League of Its Own

We initiate on Southern Copper (SCCO US), a high-quality copper play with assets in Peru and Mexico. Its long term ROCE >22% makes its a very...

Sameer Taneja

Copper Primer: What We Like About Copper And What to Play

We initiate with a primer on the copper sector. We elaborate on our fundamental rationale for being bullish on the metal and discuss different ways...

Sameer Taneja

Coal Is Back - The Real Inconvenient Truth

​Growing demand for coal outside of G-7 countries is putting pressure on already limited supply, leading to opportunities in coal stocks with...

Rikki Malik

Sumitomo Metal Mining - A Shiny Mix of Gold, Copper and Nickel

This miner has extremely conservative forecasts, some scarcity value, and a strong balance sheet for potential future buybacks and dividends.

Rikki Malik

Copper Tracker July 2024: Physical/Equity Screens And Trades

Growing demand for coal outside of G-7 countries is putting pressure on already limited supply, leading to opportunities in coal stocks with...