It’s been a long time since I’ve posted here, but it’s just been the same wish shit for weeks.
Late night DD on $SCCO:
$SCCO Southern Copper Corporation. Picked up using EV / EBITDA screener with some parameters and cross checking with options flow.
Current Price: 63.99 (+58.47% 1y and +2.48% 1D)
Market Cap: 53.07B
52 Week High: 83.29
EV / EBITDA: 11.2x
Float: 11% (~ 85M)
% of Float Shorted: 6.81%
Catalyst: Earnings and supply chain for metals. See TRQ.
**Peruvian elections continue to be tumultuous, with possible tax hikes coming to the sector if Pedro Castillo is elected (he won the popular vote, and his opponent was Keiko Fujimori, so idk what the fuck is going on in Peru.)**
**Notes on market activity:**
OI on the near the money calls has increased, driving IV up to ~35% on the 07/16 65c options and the 07/16 60p options.
LEAPS have some volume and open interest, out to 2023, w/ 01/20/23 85c being the current leader in OI.
Bond market won’t see maturity of nearest outstanding bonds until Nov of 2022.
**What the Fuck Do They Do?**
Specializes in development and production of copper, molybdenum, zinc, and silver. Geolocation primarily focused in Peru and Mexico. Macro trade trends in the supply chain may lend to a strong opportunity for South American materials to step into untapped markets. This may already be occurring, or a completed event.
**Options Market, Near-Term**
Flow shows a strong bearish sentiment in the near term, though this may be a hedge. Interestingly, almost all of these put option orders were made on 06/16/21.
**Conclusion on SCCO**
With the current state of Peru still up in the air, there is a high degree of uncertainty that appears to be being priced into the market. Also, South America, amiright?
Picking up 07/16 65c and 08/20 65c as the bid/ask dials in. Will most likely also pick up a handful of 07/16 55p as a cheap OTM hedge (currently 0.08 a contract.)