This article was originally published by TheStreet and also appeared on Yahoo! Finance
NEW YORK (TheStreet) -- Teck Resources (TCK_) is one of Canada's leading mining companies, the biggest producer of steelmaking coal in North America and the second largest player in the seaborne market, behind BHP Billiton (BHP_) and Mitsubishi's BHP Billiton-Mitsubishi Alliance. Moreover, the Vancouver-based miner is also eying entry into the energy industry in the coming years.
Teck's shares have dropped by 30% this year, to $25.25 when markets closed on Christmas Eve. As a point of reference, S&P Metals and Mining ETF (XME) has delivered relatively better, showing a decline of 10% in 2013.
That performance doesn't seem pretty. But investors must consider Teck's move into the oil sector and its growth prospects amid the expected improvement in commodity prices in the long run. At current price levels, Teck's shares are looking attractive.
The stock isn't ideal for short term investors. The business will likely remain under pressure due to persistent weakness in the commodity markets. For long term investors, however, the miner's shares are undervalued. Teck shares are trading below their book value, at just 12 times the 2014 earnings estimates. Moreover, Teck gives a juicy yield of 3.4%, way above the industry's average.
