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

Entry point of under $24, is probably not bad here. You have iron ore bumping along, and you need China’s growth for the prices to be highly profitable. They also have the copper side. He would rather wait until there were better macro signs from China. It could be flat for several more quarters. An alternative could be Hudbay Minerals (HBM-T).

This seems to be going sideways to down. Part of the problem is coal and their exposure to China. There is still growth in China, and will be for several years, but the impact on commodity prices, and therefore the mining companies coming out of the growth in China is a story of a few years ago, and not a story that is going to resurface anytime soon. This company still pays a decent dividend. Earnings this year are forecast to be just slightly ahead of the dividend, so there is a little concern that there might be a cut at some point.

This has been a volatile company. Going forward, better days are ahead.

3.5% dividend while you wait. The company has done everything possible to lower their costs so it is now a call on Met coal costs. He believes 2015/16 is when you want to own this one so he has been buying over the last year and a half. Dividend is safe. In terms of an exit strategy, he would get out if he found something better to do with the money.

Moved his money into FM-T. Met coal still looks soft. They are oversupplied right now. TCK is great operators, but all their excess cash flow is going to flow into their oil sands project, so no acquisitions or dividend increases. In terms of a metals play, prefers FM-T.

What they do is dependent on coal prices.

After a 20 year super cycle, the mining sector is finally over. The demand from developing countries is expected to continue. TCK has a very strong balance sheet. They recapitalized. Very good dividend that should be sustainable for at least a couple of years. Coal is struggling, copper will be in demand. There is some exposure to the SU-T asset. Out of favour and you will see some recovery.

If you own, holding on is not a bad play. A pretty beaten up stock and has been an under performer for a while. Metallurgical coal business has been very tough. Also, have assets in copper which has not been great lately. One strong part of their market has been zinc, whose prices have been picking up a little. When you see an earnings release that is below expectation and the stock doesn’t go down, it may be a sign that we are close to bottom.

This company needs to get Asia going because their basic sales are into Asia. China is taking on an economy that was totally export oriented, and changing it into a consumer oriented economy and yet still growing. If you see the materials side start to move, then you could add a bit more.

Met Coal and base metals, mainly copper. You need supply to come off line or demand to come up in Met Coal. Copper inventories remain low and supply is not coming on so he is more comfortable with it. It is no man’s land for this stock.

This is a space you probably don’t want to be in for a while.

(Top Pick Mar 28/13, Down 11.89%) He took a balanced approach last year. This year the base metals are up about 4%. TCK is suffering from weak met coal prices. Thinks there is light at the end of the tunnel this year. Strong balance sheet. 4% yield is safe. Continue to hold it. There is a lot of torque to it later this year.

Would not be adding this or any of the other base metals to his portfolio. There are too many question marks out of China.

Copper and Coal. For the next couple of years they will probably underperform. There is an economic dynamic for Coal over the next couple of years. Maybe not a lot of downside in copper, but these two things are a negative. From a trading perspective he is okay owning it, but don’t buy and hold.

The problem here is that coal prices are not doing very well and no one seems to think that they are going to have a recovery very soon. There is also a suspicion that they may be involved in another takeover. Seasonality has now peaked and she would expect that prices will now correct. During the summer might give you a better entry point.