Teck Quarter

Last Wednesday Teck Resources (TCK) released third quarter results and had its quarterly conference call.  The results, webcast and presentation slides are all available here (scroll down a bit).

TCK remains ISA’s favorite investment to capitalize on the industrialization of China and emerging markets.

First, the mining behemoths like BHP Billiton, Rio Tinto, Vale and Xstrata do not have the ability to grow like Teck because of the law of large numbers.  Perhaps more importantly, Teck is not exposed to iron ore.  Finally, TCK shares offer better value on the price paid.  Interestingly, Teck long ago would have have bought by one of the super-major miners except for Teck’s dual class stock structure

Currently, Teck’s largest division is met coal.  Teck’s next largest business is copper, and copper production will double by late this decade.  Zinc is a smaller Teck division, though only last decade Teck was regarded a zinc company.  Into the next decade, oil sands production could become Teck’s largest operating unit.  Teck is a well capitalized diversified mining company.

When Chinese economic growth stabilizes or re-accelerates, TCK is the ISA play.

Mean reversion: Kloppers says iron ore is back to being a volume game, get used to it at MiningTo all China bears: Iron ore has just scaled $120 also at Mining.

Today NYMEX December gas futures contract down 11.3 cents on lower demand at Platts.

U.S. coal names look to be weak tomorrow.  CLD, ACI and YZC  were all downgraded.  TCK was started as outperform.