If you've ever stood beneath Michelangelo's sculpture of David in Florence, you know that the commensurate underdog is anything but a pipsqueak. Taseko Mines
Although true industry goliaths such as Freeport McMoRan Copper & Gold
Taseko recorded a 200% increase in net earnings over the second quarter of 2008, but those results were heavily influenced by a foreign-exchange gain of $7.9 million (compared to a corresponding $600,000 loss in the prior-year period). Notwithstanding the impressive strength of copper's price recovery in recent months, the average realized price dropped 46% from the prior year, offsetting a 69% increase in copper concentrate sales volume.
When we look to mining costs, Taseko starts to increase in stature. The miner's operating cash costs, net of by-product credits, came in at just $0.96 per pound. Of course, goliath Southern Copper
Taseko's golden bullet
With less than 10% the production scale of Southern Copper, Taseko possesses a secret weapon to slay the competition. The pending Prosperity project, which Taseko is "extremely confident" will clear regulatory hurdles, offers not only 2 billion pounds of copper, but a large-scale gold reserve of 4.7 million ounces.
Whereas copper giant Teck Resources
Copper has been on a tear lately, reaching more than $2.80 per pound as China continues to build stockpiles, invest abroad, and foment commodity speculation. As a result, I perceive a near-term price correction on the horizon, with the potential for more favorable entry points ahead.
Fool contributor Christopher Barker is the commodore of copper and the Colonel Klink of zinc. He can be found blogging actively and acting Foolishly within the CAPS community under the username TMFSinchiruna. He tweets. He owns shares of Freeport-McMoRan, Taseko Mines, and Yamana Gold. The Motley Fool's disclosure policy is worth way more than $2.80 per pound.