MP Materials (NYSE:MP) Downgraded by Zacks Research to Strong Sell

Key Points

• Zacks Research downgraded MP Materials from “hold” to “strong sell,” despite the broader analyst consensus remaining “moderate buy” with a $78.21 target price.
• MP Materials reported quarterly revenue of $108.49 million, up 89% year over year and above estimates, but still posted a $0.01 loss per share and negative net margins.
• Shares opened at $59.20, down 0.2%, while insider activity was mixed: the COO purchased 10,000 shares, whereas the CEO sold 185,167 shares.

MP Materials (NYSE:MP - Get Free Report) was downgraded by equities researchers at Zacks Research from a "hold" rating to a "strong sell" rating in a research report issued to clients and investors on Wednesday,Zacks.com reports.

Other analysts have also recently issued research reports about the stock. Deutsche Bank Aktiengesellschaft dropped their target price on shares of MP Materials from $70.00 to $61.00 and set a "buy" rating for the company in a research report on Thursday, July 9th. Citigroup restated a "positive" rating on shares of MP Materials in a research report on Wednesday, July 15th. Barclays decreased their price objective on MP Materials from $69.00 to $65.00 and set an "overweight" rating for the company in a research note on Thursday, July 16th. Canaccord Genuity Group set a $82.00 price objective on MP Materials in a report on Friday, May 8th. Finally, JPMorgan Chase & Co. cut their target price on MP Materials from $75.00 to $60.00 and set an "overweight" rating on the stock in a research note on Wednesday, July 29th. Two research analysts have rated the stock with a Strong Buy rating, thirteen have given a Buy rating and two have given a Sell rating to the company's stock. According to data from MarketBeat, the stock currently has an average rating of "Moderate Buy" and a consensus target price of $78.21.

MP Materials Stock Down 0.2%

Shares of NYSE:MP opened at $59.20 on Wednesday. MP Materials has a one year low of $37.81 and a one year high of $100.25. The company has a 50 day moving average of $51.75 and a 200-day moving average of $56.82. The company has a debt-to-equity ratio of 0.48, a current ratio of 9.51 and a quick ratio of 8.56. The stock has a market cap of $10.54 billion, a price-to-earnings ratio of -174.12 and a beta of 1.88.

MP Materials (NYSE:MP - Get Free Report) last posted its quarterly earnings results on Thursday, August 6th. The company reported ($0.01) earnings per share for the quarter, hitting analysts' consensus estimates of ($0.01). MP Materials had a negative net margin of 19.85% and a negative return on equity of 1.21%. The business had revenue of $108.49 million during the quarter, compared to the consensus estimate of $96.89 million. During the same period in the previous year, the firm posted ($0.13) earnings per share. MP Materials's revenue for the quarter was up 89.0% compared to the same quarter last year. On average, sell-side analysts forecast that MP Materials will post -0.12 earnings per share for the current year.

Insider Activity at MP Materials

In other news, COO Michael Stuart Rosenthal bought 10,000 shares of the stock in a transaction on Tuesday, June 9th. The stock was purchased at an average price of $54.30 per share, with a total value of $543,000.00. Following the completion of the purchase, the chief operating officer owned 136,622 shares of the company's stock, valued at approximately $7,418,574.60. This trade represents a 7.90% increase in their ownership of the stock. The purchase was disclosed in a legal filing with the SEC, which is available at the SEC website. Also, CEO James H. Litinsky sold 185,167 shares of the stock in a transaction on Wednesday, June 3rd. The stock was sold at an average price of $69.14, for a total transaction of $12,802,446.38. Following the completion of the sale, the chief executive officer owned 11,620,798 shares in the company, valued at approximately $803,461,973.72. This trade represents a 1.57% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. 8.20% of the stock is currently owned by corporate insiders.

Institutional Trading of MP Materials

Hedge funds have recently added to or reduced their stakes in the business. California State Teachers Retirement System lifted its holdings in MP Materials by 5,523.6% during the second quarter. California State Teachers Retirement System now owns 9,225,687 shares of the company's stock worth $516,731,000 after acquiring an additional 9,061,633 shares in the last quarter. Norges Bank bought a new stake in shares of MP Materials in the fourth quarter worth about $82,531,000. BNP Paribas Financial Markets raised its position in shares of MP Materials by 76.3% during the second quarter. BNP Paribas Financial Markets now owns 2,921,542 shares of the company's stock worth $97,200,000 after purchasing an additional 1,264,243 shares during the period. Van ECK Associates Corp raised its position in shares of MP Materials by 71.6% during the fourth quarter. Van ECK Associates Corp now owns 2,834,914 shares of the company's stock worth $143,220,000 after purchasing an additional 1,183,307 shares during the period. Finally, Bank of New York Mellon Corp acquired a new stake in shares of MP Materials during the second quarter worth about $65,230,000. Institutional investors and hedge funds own 52.55% of the company's stock.

MP Materials Company Profile

MP Materials Corporation operates as a vertically integrated producer of rare earth materials in North America. The company owns and manages the Mountain Pass Rare Earth Mine and Processing Facility in California, the only commercially viable rare earth mining and processing site in the United States. MP Materials extracts, separates and refines critical rare earth elements—such as neodymium, praseodymium, and cerium—which are essential inputs for permanent magnets used in electric vehicles, wind turbines, and various defense applications.

The Mountain Pass mine first began commercial rare earth production in the 1950s and was later operated by Molycorp until its bankruptcy in 2015.

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