Teck Resources (TECK) surges 11.3%: Is this an indication of further gains?

Zacks Zacks Investment Research

Teck Resources Ltd (TECK - Free Report) shares ended the last trading session 11.3% higher at $39.07. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 8.7% gain over the past four weeks.

Shares of Teck Resources jumped since it announced that it has entered into a merger agreement with Anglo American plc (NGLOY - Free Report) to form Anglo Teck group. This merger is expected to create a global critical minerals leader and be highly attractive for both Teck Resources and Anglo American shareholders.

Anglo Teck will have more than 70% exposure to copper and set to be among the top five global copper producers. The combined annual copper production of 1.2 million tons is projected to grow by 10% to 1.35 million tons by 2027. Within four years of completion, the deal is expected to yield around $800 million in annual pre-tax synergies. Around 80% of this is expected to be achieved within two years through economies of scale and operational efficiencies.

This company is expected to post quarterly earnings of $0.44 per share in its upcoming report, which represents no change from the year-ago quarter. Revenues are expected to be $2.21 billion, up 5.7% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Teck Resources, the consensus EPS estimate for the quarter has been revised 11.5% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on TECK going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold).

Teck Resources belongs to the Zacks Mining - Miscellaneous industry. Another stock from the same industry, Nexa Resources S.A. (NEXA - Free Report) , closed the last trading session 1.4% lower at $4.8. Over the past month, NEXA has returned -0.6%.

For Nexa Resources, the consensus EPS estimate for the upcoming report has changed +25% over the past month to $0.1. This represents a change of +400% from what the company reported a year ago. Nexa Resources currently has a Zacks Rank of #3 (Hold).

Want the latest recommendations from Zacks Investment Research? Download 7 Best Stocks for the Next 30 Days. Click to get this free report

Author

Zacks

Zacks Investment Research

Zacks Investment Research provides unbiased investment research and tools to help individuals and institutional investors make confident investing decisions.

AUD/USD holds firm near 0.7000 after Chinese inflation data

AUD/USD stays firm near 0.7000 in Wednesday’s Asian session, little moved by China's mixed inflation data. CPI rose less than expected in September, while PPI inflation picked up. The pair remains underpinned by a broadly subdued US Dollar, despite the Middle East escalation, as focus will be on the US consumer inflation figures for fresh tradiing impetus.

USD/JPY consolidates near 158.50; looks to US CPI for fresh impetus

USD/JPY stays range-bound near 158.50 in the Asian session on Wednesday, with looming intervention risks supporting the Japanese Yen and capping upside amid a softer US Dollar. However, geopolitical uncertainties act as a tailwind for the safe-haven USD and the pair. Traders also seem hesitant ahead of the release of the latest US inflation figures.

Gold stays defensive near $4,150, awaits US CPI report

Gold is oscillating in a narrow band near $4,150 in the Asian session on Wednesday, awaiting US Consumer Price Index (CPI) inflation data for more cues about the Fed's policy path. Meanwhile, escalating hostilities between Saudi Arabia and Yemen's Iran-backed Houthis lift Oil prices, weighing on Gold. However, a softer US Dollar helps limit Gold's downside.

Strategy bitcoin buying model faces scrutiny as STRC costs climb

Strategy’s (MSTR) STRC financing strategy increased its Bitcoin (BTC) holdings in H1, but made its capital structure more expensive, prompting an examination of its effectiveness, according to a Tuesday report by K33. STRC recovered close to its $100 par value, closing at $99.90 after an extended period of heavy buybacks.

What happens after a US Treasury market crash

The global bond market is under severe pressure as US Treasury yields reach multi-decade highs, driven by persistent inflation risk, heavy government and corporate debt issuance, and expanding term premiums. Higher yields raise borrowing costs and tighten financial conditions, but a severe bond selloff can ultimately shift investor focus from inflation to growth and financial stability.

Has Bitcoin really escaped the macro forces it was built to fight?

Over 17 years ago, Satoshi Nakamoto designed Bitcoin (BTC) on the back of a global financial crisis as an alternative to the global monetary system outside the control of central banks, governments and traditional intermediaries. This raises a key question: has Bitcoin really become independent of the macroeconomic forces it was built to challenge?