Teck Resources stock rating downgraded by B.Riley on QB operational issues

Published 28/07/2025, 09:46
Teck Resources stock rating downgraded by B.Riley on QB operational issues

Investing.com - B.Riley downgraded Teck Resources Ltd (TSX:TECK-B) (NYSE:TECK) from Buy to Neutral and lowered its price target to C$61.00 from C$69.00 following the company’s second-quarter results. The stock has declined over 13% in the past week, with InvestingPro data showing the shares are currently in oversold territory.

The rating change comes after Teck outlined continued operational challenges at its Quebrada Blanca (QB) mine and reduced its 2025 copper and molybdenum production guidance. Despite these setbacks, the company maintains it expects to achieve design rates at QB by year-end. The company’s strong financial health score of "GOOD" and current ratio of 3.47 suggest it has ample resources to navigate these challenges.

B.Riley noted that while Teck’s other mining operations showed encouraging progress, persistent underperformance at the flagship QB asset continues to weigh on consolidated results. This marks the second downward revision to QB guidance over the past three quarters.

The research firm decided to move to the sidelines until there is more certainty in achieving steady state operations at the QB mine. Teck has maintained its 2026 guidance, though B.Riley sees these targets as incrementally at risk.

Management is currently investigating a ship loader failure to assess insurance recovery options, according to the analyst report. Despite near-term challenges, analysts maintain an average upside potential of 24% from current levels. InvestingPro subscribers can access 13 additional investment tips and comprehensive analysis for Teck Resources.

In other recent news, Teck Resources Ltd reported second-quarter revenue of CAD 2,023 million and adjusted EBITDA of CAD 722 million. The company’s copper production for the quarter totaled 109,100 tonnes. Analysts have expressed concerns over the company’s Quebrada Blanca (QB2) project, leading to a downgrade by JPMorgan from Overweight to Neutral, with a reduced price target of $41.00, citing issues with the QB2 ramp-up timeline. Desjardins also downgraded Teck Resources from Buy to Hold, lowering the price target to C$58.00 due to anticipated shortfalls in copper production at the Quebrada Blanca mine. Jefferies maintained a Buy rating but lowered its price target to C$60.00 after Teck’s Q2 EBITDA missed expectations. Raymond (NSE:RYMD) James adjusted its price target to Cdn$63.00 while maintaining an Outperform rating, following Teck’s announcement of the Highland Valley Copper Mine Life Extension project. These developments reflect a cautious outlook from analysts regarding Teck’s production capabilities and project timelines.

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