Teck Resources Ltd. (B)

(A Top Pick Sep 12/19, Down 30%) It's accelerated after phase one was announced (the US-China treaty). It enjoyed a big move today. Excellent balance sheet. He likes it and will hold it. Risk/reward is pretty good. But if this doesn't inch up to $20, he will bail.

The phase one signing will bring great relief to the materials and resources stocks. E-cars need a lot of copper. Teck hasn't made money for anybody in the last 16 years. He can't predict commodity and materials prices and won't bother. He prefers companies with pricing power which these sectors don't have. No, not for him.

He thinks it is selling at a reasonable valuation. It will have to continue to meet and beat investor expectations. He doesn't see the catalyst at the moment to do that. He is not invested right now and might consider looking at it 15% lower than today.

Not a longterm buy-and-hold. It is a trading stock. He would avoid this right now. It's finding a bottom but it looks like it'll stay around where it is right now. There are other resource stocks that have a better base.

He avoids resources stocks. Too risky, though you can buy one at the bottom of the cycle then sell at the top.

Stay away. Valuations on cyclicals are a problem. Their capital allocation hasn't been great. TECK has gone boom and bust three times in recent years. If you hold it, take profits. If the economy rolls over, this is one of the first to get hit; it's a cyclical stock. True, they're diversifying, but he wouldn't be in this space now, so late in the cycle.

He's always seen Tech as metallurgical coal for making steel. What's happening in China is important. It should bounce around $20. Teck could drop and come back if there are certain economic events. Risk-reward is quite good. (Analysts’ price target is $32.00)

(A Top Pick Nov 06/18, Down 18%) He got "Trumped" on this one. The company is solid, despite the trade war issues. It will bounce back if the trade deal gets signed. China is the main market for this. He will continue to hold it.

He has an issue with the space. Given the long term picture, is this something you want to invest in? It made nobody any money in the last decade. It is not investible in his mind. It is only tradable. Maybe at the 2016 low it could be a buy but not now.

All commodity stocks feel the trade war's impact. Teck has become a lot more dependent on coal. They also feel pressure on commodities and the general economic slowdown. It trades at a good 3-4x multiple. Doesn't pay a dividend; maybe they want to deploy capital elsewhere which is fine. You can consider this, though wishes it was a little cheaper. Around $20, you can make money on this for the next few years.

An example of where past support in 2017 is making this low risk. An excellent balance sheet and improving operational metrics. He thinks it is difficult for competitors to bring on new copper production. A break below $19.25 on a month or weekly basis would mean bigger problems are coming. Yield 0.91%. (Analysts’ price target is $34.75)

Outlook depends on global growth which as been decelerating. Teck is paying off its debt though. She holds very few cyclicals, including mining. She won't touch base metals until the global economy improves. We're late in the cycle.

It's had a wild ride. He doesn't follow them. The market has under-invested in energy. You can do worse than Teck.

Trade tensions have impacted base metals, where this company is tied to iron ore. It would do well when a trade deal is struck with China. There is starting to become some speculation in the copper area. But since many of the shares are privately held, they will still be a laggard if speculation takes hold in the space.