Tuesday, April 28, 2009

Teck Resources Ltd 2

I am continuing my review this stock (TSX-TCK.B) from yesterday. (Note that this company used to be Teck Cominco Ltd until this month when the name was changed.) If you look at Insider Buying and Selling over the past year, there is net selling, however, most of the selling took place in the mid part of 2008 when this stock was around $50. The buying has occurred most recently and this has occurred mostly around $5.

The one big buy signal is that this stock is over 50% lower than the Graham Price. The P/E is not particularly low for this stock, but the Price/Cash Flow and Price/Book Value is. Of, course the problem with this stock is that it has too much debt because it bought Fording Coal at the wrong time. This is the reason for its fall and also for the cancelling of the dividends.

When you look at the analyst recommendations, there are lots of Buys and lots of Holds and few in other categories, but no Sells. For those that think this company is a Buy, they think it is high risk or speculative Buy.

When you look at the charts on this stock, you will find that it did much better than the TSX or the Material Sub-Index until its recent fall. Over the last 5 and 10 years, it has done as well as the TSX and this is after its current dramatic fall. Personally, I do not often buy resource stocks and I will sell my 100 share shortly.

Teck is a diversified resource company involved in mining and mineral development with major business units focused on copper, metallurgical coal, zinc, gold and energy. This company has interests in several oil sands developments. The company explores for resources in the Americas, the Asia Pacific Region, Europe and Africa. Its web site is www.teck.com. See my spreadsheet on this company at www.spbrunner.com/stocks/tck.htm.

This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets.

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