Molycorp still faces challenges ramping at Mountain Pass, analyst says

|By:, SA News Editor

Molycorp (MCP -2.1%) still faces ramping headwinds, Baird analyst Ken Kallo says as he reiterates a Neutral rating and $4 price target on the shares after the company's Q4 earnings call.

Although MCP believes it can become EBITDA positive in H2 2014 through reducing costs and increasing production, the firm believes the company continues to face challenges in ramping its Mountain Pass facility, which has led to lower-than-expected production in Q1.

Kallo says he would avoid purchasing shares until further cost reductions and stable production volumes are achieved.