Street View: MP Materials to still benefit from rare earths demand despite lower sales
Updates
** Shares of rare earth producer MP Materials Corp MP.N fall ~9.9% to $11.43 in morning trade
** Company after hours on Thursdayreports Q2 adj. loss of 17 cents/shr, bigger than estimate of 9 cents/shr - LSEG data
** Reports 43% lower sales of rare earths concentrate from year ago
** Expects production of neodymium and praseodymium (NdPr) to double in Q3
COMMERCIAL CONTRACTS BOOST CONFIDENCE
** D.A. Davidson (PT $24, "buy") says "Q2 2024 sales $9 mln light of our view" but notes "additional impressive commercial successes during the quarter, including NdPr supply contracts signed with the Department of Defense and a major global auto OEM"
** TD Cowen (PT $22, "buy") says production impacted by downtime, but ramp up of operations at Stage II, "growing downstream commitments and govt support could suggest compelling future demand signals"
** Jefferies ("buy") cuts PT to $21 from $24, but says "company making solid headway on optimization and cost reduction in its separations business, which should help MP improve its output and cost per unit in H2 2024"
Reporting by Seher Dareen in Bengaluru
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