On the 22 November 2017, Southern Copper Corporation (NYSE:SCCO) will be paying shareholders an upcoming dividend amount of $0.25 per share. However, investors must have bought the company’s stock before 07 November 2017 in order to qualify for the payment. That means you have only 3 days left! Is this future income stream a compelling catalyst for dividend investors to think about SCCO as an investment today? Let’s take a look at SCCO’s most recent financial data to examine its dividend characteristics in more detail. View our latest analysis for Southern Copper

5 checks you should use to assess a dividend stock

When researching a dividend stock, I always follow the following screening criteria:

• Is it the top 25% annual dividend yield payer?

• Has it consistently paid a stable dividend without missing a payment or drastically cutting payout?

• Has the amount of dividend per share grown over the past?

• Is is able to pay the current rate of dividends from its earnings?

• Will the company be able to keep paying dividend based on the future earnings growth?

How well does Southern Copper fit our criteria?

The company currently pays out 25.38% of its earnings as a dividend, meaning the dividend is sufficiently covered by earnings. Looking forward, analysts expect SCCO to pay out 64.31% of its earnings and dividends yield to be around 1.76%. Furthermore, EPS should increase to $2.04. This means the company should be able to continue to payout dividends. Reliablity is an important factor for dividend stocks, particularly for income investors who want a strong track record of payment and a positive outlook for future payout. Not only have dividend payouts from Southern Copper fallen over the past 10 years, it has also been highly volatile during this time, with drops of over 25% in some years. These characteristics do not bode well for income investors seeking reliable stream of dividends. Relative to peers, SCCO generates a yield of 2.33%, which is on the low-side for a metals and mining stock.

What this means for you:

Are you a shareholder? If SCCO is in your portfolio for cash-generating reasons, there may be better alternatives out there. It may be beneficial exploring other income stocks as alternatives to SCCO or even look at high-growth stocks to supplement your steady income stocks. I encourage you to continue your research by taking a look at my interactive free list of dividend rockstars as well as high-growth stocks to potentially add to your holdings.

Are you a potential investor? If you are building an income portfolio, then Southern Copper is a complicated choice since it has some positive aspects as well as negative ones. However, if you are not strictly just a dividend investor, SCCO could still offer some interesting investment opportunities. I also recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. Check our latest free fundmental analysis to explore other aspects of SCCO.

To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.