TECK
Teck Resources Limited
$58.66
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Mild
·
Conviction
Overvalued
Trading 9.5% above fair value
You pay
$58.66
Bear
$42.86
Fair
$53.58
Bull
$64.30
Bear
$42.86
-26.9%
$3.26 × 12x P/E
Fair
$53.58
-8.7%
$3.26 × 15x P/E
Bull
$64.30
+9.6%
$3.26 × 18x P/E
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
18.0x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $67.50 from 26 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $53.58 per share.
Warnings
The company's reported profits differ from official accounting profits by 63%. Check what costs are being left out of the adjusted number.
Wall Street's average price target is $67.50 (from 26 analysts). Our estimate is 27% below the consensus -- consider that gap carefully.
Financial statements were converted from CAD into USD using USDCAD at 0.7093 USD per CAD.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples