Citi has moved Teck Resources Ltd (TSX:TECK-B) (NYSE:TECK) to a Buy rating from Neutral and lifted its price objective to C$104.00 from C$76.00, the bank said on Monday. The new target comes as Teck shares have already climbed sharply, returning 70.8% over the past six months and 32.7% over the last year, according to InvestingPro data.
The upgrade reflects Citi's decision to harmonize its view on Teck with its existing Buy recommendation on Anglo American. That alignment is conditioned on Citi's base case that the merger as currently announced will move forward on the terms disclosed by the companies.
Citi analyst Ephrem Ravi flagged the linkage between the two securities, noting that the C$104 price target for Teck translates to GBP 45 per Anglo American share under the mechanics of the proposed deal. Despite raising the rating and the target, the analyst left his previous financial estimates for Teck Resources unchanged, indicating no alteration to the firm's underlying forecast assumptions.
Other broker actions have been mixed amid the merger talk and commodity-market dynamics. UBS increased its Teck price target to C$90.00 from C$80.00 and kept a Buy rating, citing the company's favorable commodity mix and a bullish view on copper prices. Conversely, TD Cowen moved to downgrade Teck from Buy to Hold and cut its target to C$76.00, pointing to expectations that the stock will remain range-bound through 2026 as the merger moves toward completion. Raymond James also reduced its stance to Market Perform, adjusting copper price forecasts in light of ongoing supply challenges and inflationary pressures.
Institutional Shareholder Services Inc. has recommended shareholders vote in favor of the combination, adding an element of institutional support to the transaction process. If completed, the merger is intended to create a roughly $50 billion producer of metals, including copper and zinc.
Shareholders of both companies are scheduled to vote on the deal at special meetings in London and Vancouver on December 9. Separately, a reported approach by BHP Group valued at about A340 billion for Anglo American did not result in a deal, with BHP purportedly walking away from the offer.
Citi's upgrade to Buy, its elevated C$104 target and the decision to keep estimates intact are framed squarely around the bank's assumption that the merger will proceed on the announced terms. Market participants and other brokerages continue to express divergent views on Teck's near-term trajectory, with price targets and ratings reflecting differing assessments of commodity outlooks, merger timing and near-term trading ranges.
Given the range of recent analyst moves and the upcoming shareholder votes, market attention will likely remain on merger-related developments and how brokers adjust valuations in response to new information as it becomes available.