Don't Miss AI's Third Wave
A Tax-Free Savings Account (TFSA) is a fantastic way to grow the wealth of Canadians. That’s because all the gains you make, whether from dividends, interest, or capital appreciation, are tax-free! Even with just $7,000, smart investing in dividend stocks or growth-oriented exchange-traded funds (ETF) can compound over time. Thusly, you can allow your money to snowball without the government taking a cut.
Plus, investors can reinvest earnings to keep the growth going, thereby making it a powerful tool for generating significant income down the road, all while keeping every cent of it! So let’s get into it, shall we?
Beyond basic
Investing in basic materials is like investing in the building blocks of the global economy. This industry covers essential commodities like metals, chemicals, and raw materials used in construction, manufacturing, and everyday products. As demand for infrastructure and goods grows, companies in the basic materials sector are well-positioned to benefit. The copper for electronics, lumber for homes, or chemicals for pharmaceuticals – the need for these materials is constant and tied to the progress of various industries.
What makes basic materials particularly attractive is the ability to hedge against inflation. As costs rise, so do the prices of these essential commodities. This can boost profitability for companies in the sector. Plus, with trends like renewable energy and electric vehicles picking up, demand for key materials such as lithium and rare earth metals is surging. Needless to say, this is an exciting time to invest in a sector that’s critical for future growth.
Teck stock
Teck Resources (TSX:TECK.B) is a leading Canadian mining company that’s all about supplying these essential materials powering the world. It’s known for producing a variety of key resources like copper, zinc, and steelmaking coal, which are vital for industries ranging from construction to technology. With global operations, Teck has a strong focus on sustainability and innovation. It is now working to reduce its environmental impact while meeting the growing demand for these essential materials. Its diversified portfolio of resources also helps mitigate risks in fluctuating commodity markets, making them a solid choice for investors.
Yet what makes Teck stand out is its long-term growth potential, especially with copper. As the world moves toward electrification and green energy, the demand for copper is expected to surge. Teck is well-positioned to benefit from this trend. It’s also got a strong presence in steelmaking coal, crucial for infrastructure projects around the world. Overall, Teck Resources offers investors an opportunity to tap into the global demand for critical materials with a company that’s committed to sustainable practices.
Growing, and valuable
Teck is a now a top pick. With a market cap of $30.7 billion and enterprise value of $41.4 billion, it’s in a strong financial position. The company recently shifted focus to become a pure-play energy transition metals business, capitalizing on the growing demand for materials like copper, which is essential for renewable energy technologies. In the second quarter of 2024, Teck hit record copper production of 110,400 tonnes, with Quebrada Blanca alone contributing 51,300 tonnes. This robust production, coupled with the company’s sale of its steelmaking coal business, highlights its strategic move towards metals that will play a pivotal role in the future of green energy.
For investors, Teck’s current performance is backed by strong market fundamentals. With quarterly revenue growing by 10.1% year-over-year and cash flows from operations of $1.3 billion in Q2 2024, Teck continues to show its financial strength. Its forward annual dividend yield of 0.9% is attractive, especially with the company approving a $0.625 per share dividend to be paid in September. Additionally, Teck authorized a significant share buyback of up to $2.8 billion, providing further value to shareholders. As demand for copper and other critical metals grows, Teck is positioned to thrive. Thereby making it a solid investment for those looking to ride the wave of the energy transition.
