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Another commodity name we're watching this week is
Sothern Copper (SCCO - Get Report), the biggest copper producer in the world with more than 146 billion pounds of the metal in its reserves. Southern Copper also owns molybdenum and zinc reserves, the former giving SCCO minor exposure to rare earths.
Copper has been the base metal equivalent of gold in the last few years (not just because they're often found together), and Southern's margins show it -- the firm owns Mexican and Peruvian mines that are able to yank copper out of the ground at rock bottom costs, and as a result, SCCO earns net margins approaching 35%.
And it pays a big chunk of that out as cash to shareholders: The firm's dividend yield currently weighs in just above 5%.
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That's what happens when you have a big, concentrated owner that's focused on providing value to shareholders; because around 80% of SCCO is owned by conglomerate Grupo Mexico, SCCO has historically kept a payout ratio of around 80%. We're betting on shares this week.
SCCO was also featured recently in "
6 Dividend Stocks With Strong Payout Ratios."