If one should "hang on to winners", are those same winners worth acquiring ? The answer must be "Yes!".
You said, "..by the end of 2006, Teck will be sitting on about $14/share in cash". Is that $14 Canadian or US$ ?
Assuming that it's US$, that equals ~C$16.25..... C$16.25 for every C$62 of market cap. By way of comparison, AUR is sitting now on C$21 in cash for every C$62 of market cap. (c$3.99 per C$11.75 share)
The moot question is what returns might each expect from the re-investment of these (growing) cash balances.
I think Tek must look for acquisitions, but Aur seems to have already on hand a nice pipeline of development projects promising excellent returns. For example, the Duckpond Mine that it is building now will, I believe, produce copper at NIL cash cost per lb,(at curent metal prices), because of its zinc by-product credits. |
