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

Currently in a period of seasonal strength, which runs through until about the 1^st week in January. Technically, it looks great on a chart. It has had a huge run on the upside, and is outperforming the market quite significantly. Base metal prices are moving significantly higher, and it’s going to have a direct impact on earnings.

We have seen a huge increase in the price of coal, and this company is very much levered to coal and zinc. It has run very hard very fast, because it was a highly levered company. Relative to its peers, it has run very fast, and he wouldn’t be surprised to see a bit of correction, particularly if some of these coal contracts pull back in price a little.

He wished he owned it. It went up because of coal prices having firmed up and going higher than analysts predicted. He thinks prices will moderate next year and then comeback down somewhat. When Fort Hills comes on line they will have another leg of cash flow. It should do okay to hold for 4 to 5 years.

It has had a huge run. China cut back. It is still a good sign. From a seasonal perspective it is from Mid-November. He usually waits longer until the market sorts itself out. The analysts are getting cold on it.

Copper, zinc and met coal. It was down to about $4-$5 in January, and is now up to $27-$28. Any stock that moves up 200% in the course of the year, you are prudent to take some money off the table. Analysts have been moving their targets up, so there are probably still some opportunities for growth, but he still sees too many risks. If you own, consider taking profits.

This has had a huge run this year, and one of the best performing stocks on the TSX, because the price had gone down a lot, but also because there has been a huge recovery in coal pricing. They also have a big oil sands project. A big part of their business and earnings driver is met coal pricing. He wouldn’t buy this right here.

Commodity prices got depressed at the beginning of this and last year, and there has been a bounce back. There is a huge movement of mindless money buying and selling things, and taking them down to ridiculous levels. The recovery on this is partly from deeply oversold levels, where people thought the world was coming to an end. Coal prices are really driving a lot of the upside for this company. His sense is that it is more momentum trades in the stock market than anything else. He would be very, very careful.

Recently bought this on the expectation that with stronger met coal prices, which has been a big driver in the near term, the market is still underestimating what it could do to earnings. He is trying to capture the near term momentum of the stock, but then would probably trade out of it, and let it settle back in to the reality of where met coal might be in the 2^nd half of next year. Thinks there is another 10% upside.

Teck Resources (TCK.B-T) or BHP Billiton (BHP-N)? Both are a little overvalued and most analysts would rate them as a Hold. This is a good company, and it is just a matter of scale. BHP is a global diversified mining company, where this one is much more of a strong regional player in Canada. If you believe there is going to be a global upswing in mining and commodity prices, you would probably want this one.

Thinks some of these metal commodity stocks have gotten ahead of themselves. He would be cautious, and if he owned some, would consider taking some off the table.

Probably the last great Canadian mining company that is left. He likes that it is the one company in Canada that seems to be able to be in an acquirer as opposed to an acquiree. It is really going to depend on international growth to drive the underlying commodity prices. China, which was a big driver of growth for many, many years, is making a real shift in terms of the kind of growth it is going to have. It is more consumer led as opposed to infrastructure growth. This is not a time to buy stocks that are dependent on a big secular move in base metal prices.

He likes the base metals, which are a big chunk of their revenue. We are just about at the next level of resistance.

Probably one of the stronger names in the pro-growth area. It offers a lot of value. This has had some pretty big moves for a stock that was much lower 8-9 months ago. The chart shows some pretty big swings during its upward climb. You have to buy this at the right price and be convinced that a year from now there will not be some deflationary environment.

This has been overbought. It is a good name. Has no debt issues and a good balance sheet, but it is a commodity producer in the market that is probably in decline for many, many years. Zinc exposure is positive, coal not so positive and copper not so positive right now. Thinks it is going to far and too fast. He would look to be a buyer on a big dip of 20%-30% or more.

This has had a huge recovery. It has been a rough ride over the last couple of years. Management has done a very good job of improving the balance sheet and thinking the long-term. They have long life assets that are outstanding.