Wednesday, January 12, 2011

Thompson Creek (NYSE:TC) Goes as Molybdenum Goes, Good News in Short Term

Thompson Creek (NYSE:TC) will be driven by the performance of molybdenum in the short term, says Deutsche (NYSE:DB), and they say that's a good thing for the company.

Deutsche said, "TC’s development of the Mt. Milligan copper-gold mine should reduce its single-product valuation discount.

"Given its single-product exposure to molybdenum (moly) in the near term, Thompson Creek's (TC) outlook is closely tied to the performance of this metal. We maintain a positive view for moly given demand from new applications, uncertain supply growth, and a shifting industry cost structure as higher-cost primary product accounts for a greater proportion of world output. DB expects moly price to continue rising till 2013 which should drive share price performance."

Deutsche Bank reiterates a "Buy" rating on Thompson Creek, which closed Tuesday at $15.08, gaining $0.57, or 3.93 percent. Deutsche has a price target of $18 on them, increasing it from $16.

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