Teck Resources Ltd. (B)

TECK.B-T

Generates $4 billion in cash flow and just received an investment grade credit rating. It will survive a financial Armageddon. Their latest copper mine project will time the rise in copper prices perfectly he feels. Yield 0.71% (Analysts’ price target is $39.84)

(A Top Pick Apr 09/19, Down 12%) His copper play. The longer-term chart looks good. Cyclical commodities should do well this year. He will re-evaluate this stock in June. All copper names have been slammed during this trade war; copper is a big proxy for China.

China issues? A cyclical stock for sure, so its tough to buy and hold. The balance sheet has been right sized as the debt has been reduced. They are cheap based on earnings. If you believe China trade issues will be resolved, you should continue to hold. (Analysts’ price target is $39.84)

Cyclical. Want to take profits. Optimal time is November - February. Between now and November, tends to trade negatively. Recently, materials production fell off. Inventories will have to be alleviated, so demand for materials is lower. Longer term, if it trades below $24, he doesn't want to be there.

It has really consolidated. We are above the support level but not doing very much. It has a lot to do with China trade negotiations. Look to exit.

He would buy it on dips. It is one of the few commodity stocks he owns right now. The results have been steady. They can capitalize on the turnaround after a trade deal. Buy it below $30.

Good trend since fall 2018. They have a superb balance sheet with the US dollar as a tailwind. Now is a period of strength for TECK though it dips in mid-May--we may be seeing that dip now. Around $30 this is a buy with good support.

Resource stocks generally don’t meet his criteria. They are not price makers but price takers. He does not follow them. There are better opportunities elsewhere.

It is trying to get less dependent on the Canadian situation by diversifying around the world. It is a little bit of a barometer of this commodity reflation story. A little reluctant to have a position on this. A coal oriented name.

Way too pricey for him. Now, you can buy only stocks that are way, way cheap, because the market has gone up so much.

Likes it, because it's a premier base metals company. He's owned it in the past. It's formed a nice base. His target is $39. They produce zinc; zinc prices are rising around the world.

(A Top Pick Dec 18/18, Up 14%) It has one of the best balance sheets out there compared to other base metal stocks. Tech bottomed much before the general market bottomed. It is still pretty volatile, but because of the balance sheet and how it is positioned, it does not look like most other base metals. This is a good one to buy today if you don’t have base metals.

Late in the cycle, mining stocks need places like China to pick up demand. She isn't in this sector. Doesn't expect global demand for minerals to pick up that strongly.

Copper should rally to $3.20 with China as a tailwind (currently $2.93). For TECK.B, $33.60 is the next level to hit, then it can hit $37-39. Could be a two-month trade to early-summer. (Analysts’ price target is $38.45)

Looking macro, technical indicators have all improved. We've seen higher trading in China. The city economic surprise index is about as low as we have ever seen it. Technically it is about to turn. He owns some of their competitors. You'll need a good stop loss on this one. (Analysts’ price target is $38.00)