The following is an excerpt from Canaccord Wealth Management’sMorning Coffee report.
Teck Resources Ltd. (TSX: T.TCK.A, Stock Forum) (TSK: T.TCK.B, Stock Forum) (NYSE: TCK, Stock Forum)
is set to report Q4/12 results and issue 2013 guidance on Thursday, February 7 (before market opens). Canaccord Genuity base metals analyst Orest Wowkodaw expects Teck to report EPS of $0.46, which is in line with consensus of $0.48 (range of $0.40-0.55).
However, the market is likely to be more focused on the 2013 guidance. Wowkodaw is currently forecasting 2013 production/sales of 25.5 million tonnes of coal and 374,000 tonnes of copper, representing modest year-over-year growth of 4% and 2%.
Wowkodaw’s 2013 EPS estimate of $1.82 (based on US$175/tonne coal and US$3.60/lb copper) remains well below the consensus of $2.59, although consensus has continued to drift lower over the past few months.
As noted by Stockhouse, Don Lindsay, President and CEO of Teck has said that Wall Street analysts maybe underestimating China’s rate of growth.
Addressing the Association for Mineral Exploration B.C. conference last week, Lindsay predicted that China will enjoy robust economic growth this year, fueling demand for the metals his company produces, like copper and zinc.
“With the new leadership now in place in China, the focus is already to ensuring steady economic growth. We are investing because we do have confidence that nothing has changed with the macroeconomics in China and that long-term growth is still in place.’’
Teck Resoruces is Canada’s leading diversified mining company. On Tuesday, Teck’s Class B shares rose 1% to $36.87, leaving the company with a market cap of $21.1 billion, based on 572.9 million shares outstanding. The 52-week range is $43.25 and $26.02.