Teck Resources Ltd. (B) (TECK.B.TO)

They generate a lot of excess cash. Coal has traded in the 250 + range for a period of time. These guys produce 24 million tons a year. That was a bonus. Copper price has been sloppy lately. Global growth is slowing. That is putting a pall on the base metals in general. Balance sheet is strong. He wouldn’t be putting money here now.

The problem lies with China. He doesn’t know what is going on with China. The market is pricing the risk of a recession next month. If that doesn’t happen, the stock will fly.

Diversified in a number of metals, including copper, zinc and met coal. Stock has pulled back recently, as all base metals have based on EM and China weakness. Strong balance sheet, strong cash flow. Conservative way to participate in these areas. (Analyst's price target is $41.)

The company has gone from simply a coal producer and then to a metallurgical coal producer and now by Q4 Fort Hills will come on stream with copper, coal and energy. Nice transformation in the company. There is a hiccup in all the commodities today. The 10 year bond is looking like it will break 290. He is surprised how well the market is behaving today. He would be a buyer on a pull back.

This is a good trading stock in his opinion. It moves aggressively with good breakouts. If it breaks the current consolidation above $39, it would be bullish. It is in a consolidation presently and would sell if it takes out the support near $30. He ranks it as a 5 out of 10. (Analysts’ price target is $42)

Has a cup-and-handle chart. Buyers are willing to pay top prices--they're confident in this stock. However, sellers aren't in a rush to sell. A very bullish chart that should continue to go higher.

It's the biggest cap mineral company in Canada. Its zinc business is good, but they need to invest in copper to expand capacity. It's cheap at a low PE of less than 8x forward earnings. If the market tumbles, this will plunge, though he doesn't see it falling back to $5.

(A Top Pick May 30, 2017. Up 36%). Despite their problems, oil companies and mining companies still produce a lot of cash. When things go slower, these companies stop investing (lower CAPEX) and their free cash flow goes up more. He anticipated last year that with all that free cash flow, people would start buying the stock. This company has had a good run this year, but he expects the price to keep rising, so he is still long. Some of the other commodities will not do as well in the future, but he think zinc has life left.

All these late stage cyclical stocks should be moving, but they are not. It has a model price of $81, compared to current closing near $32. There is some speculation that the Chinese market may slow briefly, but only to ramp back up by 2020-2022 with leadership reviews. If you own it, hold it.

Question: When the company reported earnings today, why did it trade up and then dropped significantly. Answer: This type of action often reflects reactions to the conference call. He did not listen to the conference call today. The published reports indicate that it had a pretty good quarter. This is a well-run company with a diversified set of resource plays in Canada. It has a strong balance sheet and trades at a good multiple. If you like that kind of business, this is a good company.

He thinks a strong global market and commodity price recovery will allow you to continue to hold it. Yield 0.6%.

It seems too expensive today – he would have preferred to own it at $25. From a risk-reward perspective he would look elsewhere. He owns Cameco (CCO-T) instead as he prefers companies out of favour.

He doesn’t own it. They have a Brazilian company in the portfolio now called Vale SA (VALE-N). Materials do well in this later stage of the cycle. Copper is doing well. (Analysts’ price target is $42)

Sees an increase in the share price. Likes this one. Copper has had a hell of a year. Teck is well-diversified and also a good play in the Oil Sands. Has a $42 target. A good way to start playing the base metals. Really likes it for its diversification. 7x foward earnings.

We are seeing a really nice breakout. There is a level of resistance in the low to mid-30’s. This could be setting up for a double top. You don’t want to see that second low broken for more than a few days. There is danger on the chart but he will not call it a sell yet. Give it a few days.