Mar. 26, 2014, 3:38 PM
- Analysts say rare earth elements will continue to fall this year after China loses a trade dispute over its export controls, as new mines boost output and while demand in high tech products disappoints.
- A price war could break out after the U.S., EU and Japan won their case over export restrictions they said gave Chinese companies an unfair competitive edge in key sectors, says Ryan Castilloux of Adamas Intelligence; China's "only tangible defense becomes competing head-to-head on price with emerging global producers."
- Investors already are concerned about excess supply as Molycorp (MCP -3%) and Lynas (LYSCF -12.5%) boost output at their new mines; MCP aims to boost output to 20K metric tons/year after producing ~1K metric tons in Q4 2013.
- Also: REE -0.6%, AVL -2.4%, GMO -3.7%.
Mar. 26, 2014, 12:15 PM
- A World Trade Organization dispute settlement panel agrees with the U.S. in a major dispute, finding in favor of U.S. claims that China’s imposition of export restraints on rare earths, tungsten and molybdenum breach WTO rules.
- China, which produces more than 90% of the world's rare earth elements, imposed strict rare earth export quotas in 2010, saying it was trying to curtail pollution and preserve resources; prices soared by hundreds of percent, and the U.S., EU and Japan complained that the restrictions gave Chinese companies an unfair competitive edge.
- Rare earth miners include Rare Element Resources (REE) and Molycorp (MCP).
Mar. 4, 2014, 2:56 PM
- 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.
Mar. 3, 2014, 5:37 PM
Mar. 3, 2014, 5:15 PM
- Molycorp (MCP) -5.3% AH after Q4 results show another quarter of losses and a 17% Y/Y drop in revenues attributed to a shifting product mix and lower prices for rare earth minerals and lower volumes of its magnetic powders.
- FY 2013 revenues rose 5%, but negative cash flow from operations totaled $154M for the year and capital expenses totaled $379M; MCP forecasts 2014 capex will total $80M-$90M.
- Says the chlor-alkali plant at its Mountain Pass, Calif., rare earth facility has successfully completed commissioning and is now operational, which MCP expects to facilitate increased production volumes at lower production costs.
- No guidance offered.
Mar. 3, 2014, 4:15 PM
Mar. 3, 2014, 12:10 AM
Mar. 2, 2014, 5:35 PM
Jan. 2, 2014, 9:12 AM
Jan. 2, 2014, 8:28 AM
- Molycorp (MCP) +5% premarket after DA Davidson names it as a Best Pick for 2014, saying MCP is positioned to become "the most prominent, vertically integrated, low-cost supplier of rare earth materials outside of China" following heavy modernization and expansion investments at the key Mountain Pass facility (Briefing.com).
- Application of rare earths in high-growth end markets such as semiconductors, hybrid and electric vehicles, wind turbines and lasers is expected to raise demand at a 9% CAGR through 2016, the firm says.
- Shares are Buy rated with a raised price target of $8 from $6 prior.
Dec. 27, 2013, 12:46 PM
Dec. 27, 2013, 10:41 AM
- Molycorp (MCP +6.9%) rallies sharply in morning trading.
- Perhaps helping to tip sentiment is SA contributor Hawkinvest, who thinks the stock may be poised for gains going into the new year.
- "Many shorts have significant gains [in 2014] and it ... stands to reason that it could be desirable for them to wait until January to cover since this will allow them to defer taxes on the gains for an additional year," the author says.
- The piece also outlines some "longer-term" arguments for owning the stock.
Dec. 19, 2013, 9:38 AM
- Molycorp (MCP +2%) says the final unit of its multi-stage cracking plant at Mountain Pass has completed commissioning and is operational.
- The cracking plant is part of a multi-stage chemical process designed to increase the facility`s rare earth recovery rates, boost production throughput, and contribute to lower unit production costs.
- MCP says the cracking plant and other plants that comprise Mountain Pass will continue to be optimized to increase operating efficiencies and cut costs.
Dec. 3, 2013, 2:24 PM| 10 Comments
Nov. 8, 2013, 10:36 AM
- Molycorp (MCP +3.1%) is maintained with a Neutral rating and $5 price target at Goldman Sachs, which sees MCP's demand recovery as a positive though it was offset by weak pricing.
- Goldman likes the improved tone and steady fundamental progress in the Q3 results, including demand recovery for MCP's highest value product, magnetic rare earths (+20% Q/Q) and tangible cost reductions at Mountain Pass (-25% Q/Q) after several quarters of no progress.
- But the positives were somewhat offset by muted expectations for SorbX commercialization and diminished outlook for cerium sales in 2014 which, if not reconciled over the longer term, could negatively impact MCP's ability to hit sub-$10/kg production costs and/or ramp to phase two capacity.
Nov. 7, 2013, 6:22 PM
- Molycorp (MCP) -3.1% AH after missing Q3 earnings and revenue estimates but says demand and prices for rare earth products are recovering from the "worst quarter we have seen in recent memory."
- A Chinese government crackdown on illegal mining and smuggling of rare earths has helped "a semblance of stability" return to industry demand and prices, interim CEO Constantine Karayannopoulos says.
- Q3 revenue fell to $149M from $205M in the year-ago quarter but rose 9% Q/Q.
- The $1.25B expansion of MCP's main mine, Mountain Pass in California, remains on track for full commissioning in the current quarter.
MCP vs. ETF Alternatives
Molycorp Inc manufactures custom engineered rare earth and rare metal products. The Company's reportable segments include resources chemicals and oxides magnetic materials and alloys and rare metals.
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