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Investing.com - Jefferies has increased its price target on Teck Resources Ltd (TSX:TECK-B) (NYSE:TECK) to C$74.00 from C$60.00 while maintaining a Buy rating on the stock. The mining giant, currently trading at $35.11 with a market capitalization of $17.2 billion, has demonstrated strong financial health according to InvestingPro metrics.
The price target adjustment comes amid speculation that Teck Resources could become an acquisition target, potentially triggering a competitive bidding situation among interested parties.
Jefferies suggests that copper and gold companies with premium valuations and strong balance sheets might show interest in acquiring Teck, noting that Canadian regulatory approval likely wouldn’t present a serious obstacle for most potential buyers.
The firm believes Teck shares had become "deeply undervalued" on a standalone basis as the market had "basically thrown in the towel" on the company’s QB project meeting production targets over the next several years.
The new C$74 price target is based on an 8.0x 2026E EV/EBITDA multiple, which Jefferies considers "a reasonable but not overly aggressive targeted takeout multiple."
In other recent news, Teck Resources Ltd. reported its second-quarter 2025 earnings, exceeding expectations with an earnings per share (EPS) of $0.38, compared to the forecasted $0.23. However, the company faced a setback with its revenue, which came in at $2.02 billion, falling short of the $2.17 billion forecast. This earnings announcement was followed by a notable share price drop, although specific stock price movements are not discussed here. Additionally, Deutsche Bank has upgraded Teck Resources’ stock rating from Hold to Buy, maintaining a price target of $42.00. The upgrade was attributed to what Deutsche Bank analyst Liam Fitzpatrick described as a "compelling value opportunity," noting that Teck shares have underperformed due to ongoing challenges at the company’s QB copper project. These developments highlight a mix of positive and challenging news for Teck Resources in recent times.
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