For those looking to find strong Basic Materials stocks, it is prudent to search for companies in the group that are outperforming their peers. Has Southern Copper (SCCO) been one of those stocks this year? A quick glance at the company's year-to-date performance in comparison to the rest of the Basic Materials sector should help us answer this question.Southern Copper is one of 241 individual stocks in the Basic Materials sector. Collectively, these companies sit at #7 in the Zacks Sector Rank. The Zacks S ...

Momentum investing is all about the idea of following a stock's recent trend, which can be in either direction. In the "long context," investors will essentially be "buying high, but hoping to sell even higher." And for investors following this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving in that direction. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.Even ...

Industry Overview - The Zacks Mining - Non Ferrous industry is currently experiencing promising prospects due to rising metal prices and increasing demand for non-ferrous metals driven by energy-transition trends [1][4] - Non-ferrous metals such as copper, gold, silver, cobalt, molybdenum, zinc, aluminum, and uranium are essential across various sectors including aerospace, automotive, and renewable energy [3][6] - The industry is characterized by a complex and capital-intensive mining process, with companies focusing on reserve growth and resource enhancement through exploration and acquisitions [3] Metal Price Trends - Copper futures recently peaked at $5.1 per pound, marking a 25% increase over the past year, while silver prices surged 84% year-to-date, currently at $53 per ounce [4] - Gold prices have also risen by 58.8% year-to-date, reaching $4,150 per ounce, supported by expectations of lower interest rates and tightening supply [4] - Uranium prices recently retreated to $77 per pound after reaching a 14-month high of $84, with supply concerns easing [4] Demand Drivers - The demand for non-ferrous metals is expected to remain high, particularly due to the growth of electric vehicles and renewable energy initiatives [6] - The U.S. Infrastructure Investment and Jobs Act is anticipated to drive significant demand for non-ferrous metals as infrastructure upgrades and green policies are implemented [6] Industry Challenges - The industry faces challenges such as a shortage of skilled workforce, rising production costs, and supply chain issues, which have led to increased operational expenses [5] - Companies are focusing on cost-reduction strategies, digital innovation, and alternative energy sources to mitigate these challenges [5] Investment Opportunities - Companies like Southern Copper Corporation (SCCO), Lundin Mining Corporation (LUNMF), Coeur Mining (CDE), and Centrus Energy (LEU) are well-positioned to capitalize on industry growth through reserve building and technological investments [2][17][21][24] - SCCO has a significant capital investment program exceeding $15 billion, primarily in Peru, and is expected to produce substantial copper outputs in the coming years [17][18] - LUNMF has reported strong operational performance, with a year-to-date stock gain of 111.7% and an increase in copper production guidance [23] - Centrus Energy is expanding its uranium enrichment capabilities, with a revenue backlog of $3.9 billion and plans for significant production increases [26] Market Performance - The Zacks Mining - Non Ferrous industry has outperformed the Zacks Basic Materials sector, gaining 10.1% over the past year, while the sector declined by 3.6% [10] - The industry's current trailing 12-month EV/EBITDA ratio is 10.59X, significantly lower than the S&P 500's 18.43X, indicating potential valuation upside [13]

Group 1 - Fresnillo PLC is currently outperforming its peers in the Basic Materials sector, with a year-to-date return of approximately 277.8%, compared to the sector average of 17.9% [4] - The Zacks Rank for Fresnillo PLC is 1 (Strong Buy), indicating a positive outlook based on earnings estimates and revisions, with a 54.3% increase in the consensus estimate for full-year earnings over the past three months [3] - Fresnillo PLC belongs to the Mining - Silver industry, which has seen an average gain of 101.9% this year, further highlighting its strong performance within its specific industry [5] Group 2 - Lundin Mining, another stock in the Basic Materials sector, has also shown strong performance with a year-to-date return of 101.6% and a Zacks Rank of 2 (Buy) [4][5] - The Mining - Non Ferrous industry, which includes Lundin Mining, has a lower ranking (28) and has gained 18.3% since the beginning of the year, indicating that Fresnillo PLC is performing better than its industry peers [6]

Core Insights - Freeport-McMoRan Inc. (FCX) experienced an increase in both revenue and net income in Q3, driven by higher copper and gold prices, although lower sales volumes negatively impacted results [1][3] - The company’s copper sales volumes fell approximately 6% year-over-year to 977 million pounds, primarily due to the suspension of operations at the Grasberg Block Cave mine in Indonesia following a mud rush incident [1][7] - Gold sales volumes decreased significantly, with FCX selling 336,000 ounces, down around 40% year-over-year [1] Sales Volume Outlook - For Q4, FCX anticipates minimal contribution from the Indonesia operation due to the Grasberg incident, projecting copper sales volumes of 635 million pounds, reflecting a 35% sequential and 36% year-over-year decline [2][7] - The guidance for gold sales volumes is also weak, with expectations of only 60,000 ounces, indicating substantial decreases both sequentially and year-over-year [2] Financial Implications - The decline in sales volumes is expected to strain FCX's financial performance in Q4, despite the potential for margin expansion from higher realized prices [3][7] - The Zacks Consensus Estimate for FCX's earnings suggests a year-over-year increase of 1.4% for 2025 and 28.5% for 2026, although EPS estimates have been trending lower over the past 60 days [8] Industry Comparison - Among peers, Southern Copper Corporation (SCCO) reported a 3.6% year-over-year decline in copper sales volumes, while BHP Group Limited (BHP) saw an 11% decrease in copper sales for the first quarter of fiscal 2026 [4][5] - FCX's stock has risen 8.3% year-to-date, compared to an 18.8% increase in the Zacks Mining - Non Ferrous industry [6] Valuation Metrics - FCX is currently trading at a forward 12-month earnings multiple of 21.33, which is a 5.8% premium to the industry average of 20.17 [9] - The stock carries a Zacks Rank 3 (Hold) [11]

Core Viewpoint - Freeport-McMoRan Inc. (FCX) has experienced a decline in stock price, falling below the 200-day simple moving average, despite reporting increased revenues and profits due to higher copper and gold prices. The company's guidance indicates rising unit costs and lower expected sales volumes for copper and gold [1][7][28]. Stock Performance - FCX's stock has dropped 5.3% over the past month, outperforming the Zacks Mining - Non Ferrous industry, which declined by 8.6%, but underperforming the S&P 500's 1.2% drop. Competitors Southern Copper Corporation (SCCO) and BHP Group Limited (BHP) have seen losses of 8.3% and 5.5%, respectively [5]. Financial Performance - In Q3 2025, FCX reported operating cash flows of approximately $1.7 billion, with a strong liquidity position of $4.3 billion in cash and equivalents, and $3 billion available under its revolving credit facility [13]. The company ended the quarter with a net debt of $1.7 billion, below its target range of $3-$4 billion [14]. Production and Expansion Plans - FCX is focused on expanding its copper output, with significant projects underway, including a large-scale concentrator expansion at Cerro Verde in Peru, which is expected to add around 600 million pounds of copper annually [10]. The company is also evaluating expansion opportunities at El Abra in Chile and conducting pre-feasibility studies in Arizona [11]. Copper and Gold Prices - The average realized copper price for FCX increased nearly 9% year-over-year to $4.68 per pound in Q3 2025, contributing positively to its financial results [19]. However, copper prices have shown volatility, with fluctuations influenced by global economic conditions [17][18]. Cost and Sales Volume Challenges - FCX's average unit net cash cost per pound of copper rose to $1.40 in Q3 2025, a 24% increase from the previous quarter, driven by lower sales volumes [20]. The company anticipates further increases in unit costs and a significant decline in copper sales volumes for Q4 2025 due to operational suspensions at the Grasberg mine [21][23]. Earnings Estimates - Earnings estimates for FCX have been revised downward over the past 60 days, indicating a cautious outlook for the company [24]. Valuation - FCX is currently trading at a forward price/earnings ratio of 21.34X, which is a premium to the industry average of 20.3X, but at a discount to Southern Copper and a premium to BHP Group [25]. Investment Outlook - Despite the challenges posed by weaker sales volume outlook and higher expected unit costs, FCX's strong financial health and ongoing expansion projects suggest a potential for future growth. Holding the stock is recommended for current investors [28].

Core Insights - Green Plains Renewable Energy (GPRE) is outperforming its peers in the Basic Materials sector, with a year-to-date return of approximately 19%, compared to the sector average of 17.8% [4] - GPRE holds a Zacks Rank of 2 (Buy), indicating a positive earnings outlook and strong analyst sentiment [3][4] - The Zacks Consensus Estimate for GPRE's full-year earnings has increased by 4.5% over the past three months, reflecting improved analyst sentiment [4] Company Performance - GPRE is part of the Chemical - Specialty industry, which has seen a decline of about 3.3% year-to-date, further highlighting GPRE's strong performance relative to its industry [6] - Another notable stock in the Basic Materials sector is Lundin Mining (LUNMF), which has achieved a remarkable year-to-date increase of 87.4% and also holds a Zacks Rank of 2 (Buy) [5][6] Industry Context - The Basic Materials sector includes 240 companies and is currently ranked 7 in the Zacks Sector Rank, which evaluates the strength of various groups based on the average Zacks Rank of individual stocks [2] - The Chemical - Specialty industry, to which GPRE belongs, is ranked 164 in the Zacks Industry Rank, indicating a relatively weaker performance compared to other industries [6]

Core Insights - Centrus Energy Corp. reported quarterly earnings of $0.19 per share, missing the Zacks Consensus Estimate of $0.20 per share, compared to a loss of $0.30 per share a year ago, indicating an earnings surprise of -5.00% [1] - The company posted revenues of $74.9 million for the quarter ended September 2025, missing the Zacks Consensus Estimate by 6.18%, but showing an increase from $57.7 million in the same quarter last year [2] - Centrus Energy shares have increased approximately 391.2% since the beginning of the year, significantly outperforming the S&P 500's gain of 15.1% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $1.16 on revenues of $148.82 million, and for the current fiscal year, it is $4.31 on revenues of $456.26 million [7] - The estimate revisions trend for Centrus Energy was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - The Mining - Non Ferrous industry, to which Centrus Energy belongs, is currently in the top 12% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - United States Antimony Corporation, another company in the same industry, is expected to report quarterly earnings of $0.02 per share, reflecting a year-over-year change of +300%, with revenues anticipated to be $12.5 million, up 416.5% from the previous year [9][10]

Core Insights - Ero Copper Corp. reported quarterly earnings of $0.27 per share, missing the Zacks Consensus Estimate of $0.36 per share, representing an earnings surprise of -25.00% [1] - The company posted revenues of $177.1 million for the quarter ended September 2025, which was 14.82% below the Zacks Consensus Estimate and an increase from $124.8 million year-over-year [2] - Ero Copper shares have increased by approximately 52.9% since the beginning of the year, outperforming the S&P 500's gain of 16.5% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.80 on revenues of $228.3 million, and for the current fiscal year, it is $1.99 on revenues of $753.8 million [7] - The estimate revisions trend for Ero Copper was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - The Mining - Non Ferrous industry, to which Ero Copper belongs, is currently in the top 10% of over 250 Zacks industries, suggesting a favorable outlook for stocks within this sector [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Core Insights - Coeur Mining reported quarterly earnings of $0.23 per share, missing the Zacks Consensus Estimate of $0.25 per share, but showing an increase from $0.12 per share a year ago, resulting in an earnings surprise of -8.00% [1] - The company posted revenues of $554.57 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 1.38% and significantly up from $313.48 million year-over-year [2] - Coeur Mining shares have increased approximately 219.6% since the beginning of the year, outperforming the S&P 500's gain of 17.2% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.32 on revenues of $612.5 million, and for the current fiscal year, it is $0.86 on revenues of $2 billion [7] - The estimate revisions trend for Coeur Mining was favorable ahead of the earnings release, resulting in a Zacks Rank 1 (Strong Buy) for the stock, indicating expected outperformance in the near future [6] Industry Context - The Mining - Non Ferrous industry, to which Coeur Mining belongs, is currently ranked in the top 7% of over 250 Zacks industries, suggesting a strong outlook for stocks within this sector [8]