Interesting take on metals and coal. Some thoughts on copper, FCX and TCK included.

Full article..

http://seekingalpha.com/article/316398-2012-will-begin-with-several-candidate-trades-for-the-commodity-crash-playbook?ifp=0&source=email_porfolio

Relevent part for TCK as follows

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Stocks: Teck Resources Limited (TCK), Northern Dynasty Minerals (NAK)

Description: I erroneously left TCK off my original list of picks. It is a very interesting diversified commodity play. Here is the description from the company’s profile:

“Teck Resources Limited operates as a diversified mining, mineral processing and metallurgical company. The company engages in a range of activities related to mining, including exploration, development, smelting, refining, safety, environmental protection, product stewardship, recycling and research. It produces copper and metallurgical coal; zinc, lead and molybdenum concentrates; specialty metals comprising cadmium, germanium and indium; precious metals consisting of silver and gold; advanced materials, such as low alpha lead, high purity copper plating anodes and indium powder for semiconductor and integrated circuit, thermal interface, solar panel and next generation technology applications; and chemicals and fertilizer products. The company also holds interests in various oil sands development assets; and owns or has interests in 13 mines in Canada, the United States, Chile and Peru, as well as one metallurgical complex in Canada. In addition, it is involved in exploration business in the Americas, the Asia Pacific, Europe, and Africa; and has partnership interests in a wind power project.”

I love diversified companies like this, especially when they get as cheap as TCK does. I am salivating after its valuation near book value. TCK is also trading with a trailing and forward P/E around 8. After FCX/SCCO, TCK will likely be my next commodity-related purchase in 2012. TCK is not for faint-hearted investors: The stock plunged as low as $2.70 during the recession. The stock is still 13 times those levels now. TCK is likely trading under pressure from coal prices. Incredibly, the low analyst price target on TCK is $47. The median is $55. In situations like this, it often helps to wait for the analysts to (belatedly) mark down their price targets to reflect some “new reality.” I will be focused on learning a lot more about TCK in 2012.

NAK is a very speculative play, but worth watching in 2012. NAK acquired its Pebble Project from TCK in 2001 and claims it “... is one of the world’s most extensive undeveloped copper-gold porphyry systems with the potential to produce up to one-quarter of America’s domestic copper supply for more than 50 years.” NAK traded as low as $1.60 in 2008 and as high as $21.76 in February of this year. This is stomach-churning volatility, but at a steep discount, this stock could be worth the ride. I will be learning more about this company in 2012."