Teck Resources (TCK) Is Strong On High Volume Today

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer.

Trade-Ideas LLC identified Teck Resources ( TCK) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Teck Resources as such a stock due to the following factors:

  • TCK has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $58.0 million.
  • TCK has traded 639,513 shares today.
  • TCK is trading at 2.44 times the normal volume for the stock at this time of day.
  • TCK is trading at a new high 4.01% above yesterday's close.

'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into a stock ahead of a catalyst. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize. In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

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More details on TCK:

Teck Resources Limited explores, develops, and produces natural resources in the Americas, the Asia Pacific, Europe, and Africa. Its principal products include copper, including copper concentrates and cathode copper; steelmaking coal; and refined zinc and zinc concentrates. The stock currently has a dividend yield of 1.7%. TCK has a PE ratio of 23. Currently there are 4 analysts that rate Teck Resources a buy, 3 analysts rate it a sell, and 6 rate it a hold.

The average volume for Teck Resources has been 4.6 million shares per day over the past 30 days. Teck has a market cap of $6.6 billion and is part of the basic materials sector and metals & mining industry. Shares are down 16.8% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Teck Resources as a hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including poor profit margins, weak operating cash flow and feeble growth in the company's earnings per share.

Highlights from the ratings report include:
  • The current debt-to-equity ratio, 0.49, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.39, which illustrates the ability to avoid short-term cash problems.
  • Despite the weak revenue results, TCK has outperformed against the industry average of 17.3%. Since the same quarter one year prior, revenues slightly dropped by 2.9%. Weakness in the company's revenue seems to not be hurting the bottom line, shown by stable earnings per share.
  • The gross profit margin for TECK RESOURCES LTD is currently lower than what is desirable, coming in at 33.84%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 3.35% trails that of the industry average.
  • Net operating cash flow has decreased to $372.00 million or 31.74% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

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