Teck Resources (NYSE:TCK) Rebounds Quickly After Disappointment

It didn't take long for Teck Resources (NYSE:TCK) to quickly rebound from its $5.27, or 8.34 percent fall Wednesday, after shares of the company were temporarily punished. Teck ended Wednesday at $57.95, and surged to close Thursday at $58.68, up $0.40, or 0.69 percent.

Even though the earnings report was solid, investors didn't initially take it that way, as earnings came in at C$361 million, or 61 cents a share, down from the $411 million, or 70 cents a share in the same quarter last year.

Most of that was the result of a huge charge from the refinancing of its debt. CEO Don Lindsay said there were no further plans for the company to cut debt in 2011 after reducing debt by $3.1 billion in 2010.

Adjusted net earnings were up 76 percent, reaching C$548 million on record revenue of C$2.8 billion. Cash flow from operation rose to C$2.7 billion for the full year.

Other than the strike still on at Teck's Elkview mining complex, there is little not to like about about this company. The strike could have a detrimental effect on the med-coal volume guidance in 2011 if it goes on for a long time. 2011 met-coal guidance as at 24.5 million to 25.5 million tons.

Once that is sorted out, Teck still will have a nice premium of $63 a ton over rival Alpha Natural Reources (NYSE:ANR). Add to that the unknown amount of time it'll take Australian miners to dig out of the flood-ravaged region, and Teck is sitting nice with met-coal. Margins of 39 percent in 2010 are expected to expand in 2011, adding to earnings results.

But that's only part of the story. Teck is still going to profit the most from copper, and in that regard, Teck sees expansion of 12 percent to 350,00 tons in 2011. In 2012, they're going to increase that to 400,000 tons. At this time Teck gets a 49 percent operating margin from copper.

Add to this Tecks 20 percent stake in the Fort Hills oil sands project and Galore Creek with NovaGold Resources (AMEX:NG), and you see the future growth pipeline the company has in place. And that's just a portion of the pipeline they have going for them.

The last quarter in this light was largely irrelevant. The good news is the company shed over $3 billion in debt and are in a strong position to compete in 2011 and beyond.