Teck Resources (TECK – Research Report), the Basic Materials sector company, was revisited by a Wall Street analyst yesterday. Analyst Chris LaFemina from Jefferies reiterated a Buy rating on the stock and has a C$75.00 price target.
Chris LaFemina has given his Buy rating due to a combination of factors including Teck Resources’ robust pricing realization for coal, leverage to copper, and anticipated capital returns post the sale of Elk Valley Resources (EVR). Although Teck’s first-quarter coal sales volume was at the lower end of the guidance range, the realized price was nearly equivalent to the benchmark, indicating strong pricing power. Despite a reduction in estimates due to these sales figures and weather-related challenges, the underlying value drivers for Teck remain intact, particularly with regard to its copper segment and the financial flexibility expected from the divestment of EVR.
Moreover, LaFemina’s confidence in Teck is bolstered by the prospective buyback program following the EVR transaction, which could amount to at least US$2 billion. This move is anticipated to enhance shareholder value through capital redistribution or debt reduction. With Teck trading at an attractive 2024E P/E and EV/EBITDA multiples, the analyst sees significant upside potential. The forthcoming financial results and progress on the QB2 project will be critical in assessing the company’s trajectory, but the analyst’s outlook remains positive, reinforcing the Buy rating.
In another report released today, Scotiabank also maintained a Buy rating on the stock with a C$68.00 price target.
TECK’s price has also changed moderately for the past six months – from $39.410 to $46.920, which is a 19.06% increase.
TipRanks tracks over 100,000 company insiders, identifying the select few who excel in timing their transactions. By upgrading to TipRanks Premium, you will gain access to this exclusive data and discover crucial insights to guide your investment decisions. Begin your TipRanks Premium journey today.
Teck Resources (TECK) Company Description:
Teck Resources Ltd. is a diversified resource company, which engages in the mining and mineral development of copper, steelmaking coal, zinc, and energy properties. The firm also produces germanium and indium. It operates through the following business segments: Steelmaking Coal, Copper, Zinc, Energy, and Corporate. The Steelmaking Coal segment exports steelmaking coal. The Copper segment produces copper in Canada, Chile, Peru, North America, and South America. The Zinc segment operates fully integrated zinc, lead smelting, and refining facilities. The Energy segment covers the oil sands mining and processing operations. The Corporate segment provides administrative, technical, financial, and other support to all of the business units. The company was founded on September 24, 1951 and is headquartered in Vancouver, Canada.
Read More on TECK:
