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Strategies & Market Trends : Winter in the Great White North -- Ignore unavailable to you. Want to Upgrade?

To: teevee who wrote (1592)	11/4/2001 12:53:55 PM
From: ralfph	Read Replies (2) \| Respond to of 8273

TEK.b -some action defies all logic. TEK closed at 11.50 on friday. If one was to look only at the charts with no knowledge of the third quarter results this bounce would have made good sense. Matter of fact I had a sell at 11.56 placed about a month before the results came out.That sell order was placed because of what I thought was pretty sound reasoning at the time and attempt to swing trade the stock for a10% gain.After the news I bailed.(But I waited until the night after the news and reread it several times before desiding to bail ) take a look at the second quarter results. Teck's net earnings in the second quarter, consolidating the results of Cominco net of the 50% minority interest, were $23 million or $0.22 per share, compared with $11 million or $0.10 per share a year a ago .The significantly higher earnings were mainly a result of the profit from power sales by the Trail division of Cominco, At June 30, 2001 working capital was $885 million, including cash of $394 million, compared with working capital of $760 million and cash of $266 million at the end of 2000. Net debt (long-term debt less cash and restricted funds held for the Cajamarquilla expansion), excluding the exchangeable debentures, was $513 million or 12% of total capitalization. and the third quarter At September 30, 2001 working capital was $551 million, down from $885 million at the end of the second quarter, after a cash outlay of $315 million in relation to the merger with Cominco Ltd. Net debt (long-term debt less cash and restricted funds held for the Cajamarquilla expansion) was $949 million or 27% of net debt plus equity. (1) before the third quarter TEK was making 1.35 a share per year . After the third quarter it dropped to 16 cents per year. I do not care what the reason is a drop like this should have rattled the market for at least a couple of days not hours. (2) Lets take TEKs quarterly results (last at 17 cents per share . pad em a bit to say 20 and multiply by 4 and a PE of 8 .this gives us a value of 6.40 per share.t lets call this top end (3) Lets take TEKs quarterly reports and discount the power sales and look at the core company. 14 cents per share time 4 and use the low end of a good PE ratio of 7. This gives us a value of 3.92 per share. lets call this the bottom end. The average of this range is 5.20 . TEK is trading at 100 % over value. Compound this with the free cash dropping and the debt climbing and things do not look too good. Compound this with the company failing to meet thisyears debt reduction goals(they may pull a rabbit out of the hat yet but it looks unlikely) and things look worse. Compound this with the delution trend that has occurred this year and one should be concerned. Compound this with the recession and commodity prices showing no turn around in the near future and the stock really looks over priced. Compound this with the company postponing their trip to the New York stock exchange. Why they do that ? Not cuss things look good me thinks. Conclusion? This friggin thing is over priced! It is kaka on a stick. A shorting candidate. It is being played with. and last but far from least........ I do not have a cluewhat I am talking about.WEEEEEEEEEEEEEEEEEEEEEEEEEEE <ggg> regards ralfph Aint life grand ? I had a wonder full day out in the woods staking a granite claim with a friend yesterday. Nice warm dry day .