I note that since I posed the question of why SCCO would double their share buy-back program I received only a couple of vague answers as to why they would do this.
Let me posit a very simple answer.
If I owned SCCO and I was intimately aware of all of my plans and those plans (i.e. capex & ???) and a very educated outlook of copper demand, told me that my share price had limited near to mid-term upside potential and likely a greater downside potential ..... what would I do.
You got it ....... I'd give myself the OPTION to scoop-up more of my shares at bargain (oversold) prices. To me, this means that every time SCCO buys-back more shares it reaffirms their confidence in the LONG-TERM future of their business and it's profitability.
Bottom line ...... short to mid-term share price appreciation and dividends ..... not so good. ..... long-term share price upside potential with a restoration of historical dividends a very good potential.
So ...... you've got to ask yourself the question do I invest in SCCO at bargain (oversold) prices and wait or do I hold-off and buy into SCCO after share prices start to rise (perhaps significantly)?
it tells me i don't have stockholm syndrome. i would rather have a
dividend and stupidly waste the money giving it to charity or watch other people
buy drugs with their dividends. i feel sorry for people who don't appreciate
the beauty of doing nothing for dividenttttt money.
DAR....are you buying here? I have owned this on and off for years, and have been looking to buy since it broke $30...but...it just keeps going down....looks like drop in copper prices has stopped, but what do I know???
No, because my core position of 11,000 shares at a weighted average cost of a hair over 11.01 is enough for me at the current yield which I expect will continue to be low until the expansion projects are finished in a few years. The short version is no because I am a yield investor.
If I were much younger and much more interested in growth for later income, I'd be buying like crazy until somebody invents a better mousetrap for copper or scco does something stupid like buying into a business it knows nothing about.
Copper is cyclical as well as seasonal. Accept it and the volatility that goes with it or stay out. As long as copper is an essential metal with little competition in many applications, SCCO is well positioned as close to the lowest cost producer with the largest reserves. All copper miners produce all they can and sell all they produce. The price is set by the world market. The only thing left to differentiate the best from the worst is cost per pound. If you want to invest in copper for the long, long term, imo, scco is the place to be.