Topic: How To Invest

The Successful Investor Hotline – Friday, November 17, 2023

Article Excerpt

TECK RESOURCES LTD., $49.40, Toronto symbol TECK.B, remains a buy for investors seeking long-term gains from the Resources sector of their portfolio. The company is a leading producer of metallurgical coal, a key ingredient in steelmaking. It also produces copper and zinc. Teck has agreed to sell its coal business, known as Elk Valley Resources (EVR). Under the terms of the deal, Switzerland-based mining company Glencore plc (Over-the-counter Pink Sheets symbol GLCNF) will acquire 77% of EVR. Japanese steel maker Nippon Steel Corp. will hold 20% of EVR, while South Korea’s POSCO will own the remaining 3%. In all, Teck will receive cash of $9.0 billion U.S. To put that in context, the company’s market cap (the total value of all outstanding shares) is $25.7 billion (Canadian). Assuming regulators approve, Teck expects to complete the transaction in the third quarter of 2024. The company plans to use some of that cash to pay down its long-term debt of $6.35 billion (as of September 30, 2023). It…