Lynas Rare Earths (LYC) AI Stock Analysis

• Market Cap: $7.79B
• Dividend Yield: N/A
• Average Volume (3M): 5.16M
• Price to Earnings (P/E): 153.1
• Beta (1Y): 0.62
• Revenue Growth: -20.07%
• EPS Growth: -74.91%
• Country: AU
• Employees: 270
• Sector: Basic Materials
• Sector Strength: 63
• Industry: Industrial Materials
• EPS (TTM): 0.03
• Shares Outstanding: 935,446,900
• 10 Day Avg. Volume: 5,486,408
• 30 Day Avg. Volume: 5,158,779
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $7.60
• Price Target Upside: -1.24% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 11

Lynas Rare Earths Limited's overall stock score reflects a balance between financial challenges and technical momentum. While financial performance is currently weak, with declining margins and cash flow issues from high capital expenditures, the technical indicators suggest positive stock momentum. Valuation concerns arise from a high P/E ratio, but the earnings call provides some optimism with production improvements and market recovery signs. The combined factors indicate a cautious outlook with potential for recovery if financial performance improves.

Positive Factors

Expansion Projects

Lynas' heavy rare earth separation capabilities are progressing, marking the company as the only provider outside China, which could allow for pricing independent of China indices.

Government Support

Lynas is in discussions with the U.S. government to potentially increase its prior commitment of $300 million in grants for the Seadrift, TX planned refiner project.

Production Growth

The Mt Weld expansion project is on track for completion, which will support production growth.

Negative Factors

Market Demand

Pricing is expected to remain subdued due to ongoing weak demand in China.

Revenue Performance

Lynas' 3Q revenues missed estimates due to a 19% reduction in overall rare earth concentrate volumes, impacted by maintenance and modifications.

Valuation Concerns

Lynas Rare Earths Ltd. has been downgraded to Neutral from Buy due to valuation concerns.

Lynas Rare Earths Business Overview & Revenue Model

Company Description

Lynas Rare Earths Limited, together with its subsidiaries, engages in the exploration, development, mining, extraction, and processing of rare earth minerals primarily in Australia and Malaysia. The company holds an interest in the Mount Weld project, Western Australia. Its products include yttrium, lanthanum, cerium, praseodymium, neodymium, promethium, samarium, europium, gadolinium, terbium, dysprosium, holmium, erbium, thulium, ytterbium, and lutetium. The company also develops and operates advanced material processing and concentration plants. In addition, it offers corporate services. The company was formerly known as Lynas Corporation Limited and changed its name to Lynas Corporation Limited in November 2020. Lynas Rare Earths Limited was incorporated in 1983 and is headquartered in East Perth, Australia.

How the Company Makes Money

Lynas Rare Earths Limited generates revenue primarily through the sale of rare earth materials extracted from its mining operations and processed through its advanced refining facilities. The company's key revenue streams include the production and sale of rare earth oxides, which are utilized in the manufacturing of permanent magnets, catalysts, and other high-tech applications. Lynas benefits from strategic partnerships and long-term contracts with major industrial clients who require reliable supplies of rare earth materials for their products. Additionally, the company's earnings are influenced by global demand for rare earth elements, fluctuations in market prices, and its operational efficiency in mining and processing activities.

Lynas Rare Earths Financial Statement Overview

Summary

Lynas Rare Earths Limited is experiencing challenges in revenue growth and profitability, with declining margins reflected in the income statement. However, the balance sheet remains strong with low leverage, and cash flow concerns are mainly due to high capital expenditures. The company should focus on cost management to improve financial performance.

Income Statement

Lynas Rare Earths Limited has experienced a significant decline in revenue and profitability over the past year. The gross profit margin decreased due to rising costs or reduced sale prices. Similarly, net profit margin and EBIT margin reflect this downturn, indicating operational inefficiencies or market challenges. However, the company exhibited strong EBITDA margins in prior years, showing potential for recovery if cost structures are optimized.

Balance Sheet

The company maintains a strong equity position with a low debt-to-equity ratio, indicating financial stability and reduced financial risk. The equity ratio is healthy, reflecting a well-capitalized structure. However, the decline in return on equity (ROE) suggests challenges in generating profits from shareholders' investments. Despite this, the overall balance sheet position remains robust, providing a buffer against economic volatility.

Cash Flow

Lynas Rare Earths Limited faced substantial negative free cash flow due to high capital expenditures, impacting cash resources. The operating cash flow to net income ratio indicates that cash generation from operations is not aligning with reported earnings. However, historic positive cash flow trends suggest potential for improvement if capital expenditures are managed effectively.

Breakdown
Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
464.45M	739.28M	920.01M	489.02M	305.11M
	Gross Profit
184.46M	325.60M	563.54M	179.48M	30.10M
	EBIT
72.42M	279.82M	524.68M	155.29M	-13.40M
	EBITDA
172.44M	416.61M	607.80M	239.28M	70.43M
	Net Income Common Stockholders
84.51M	310.67M	540.82M	157.08M	-19.39M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
523.84M	1.01B	965.58M	680.83M	101.73M
	Total Assets
2.80B	2.64B	2.06B	1.48B	936.13M
	Total Debt
183.98M	190.35M	190.46M	173.19M	201.96M
	Net Debt
-339.86M	-820.86M	-775.12M	-407.63M	100.23M
	Total Liabilities
562.12M	475.27M	416.02M	394.17M	417.74M
	Stockholders Equity
2.24B	2.16B	1.65B	1.08B	518.38M
Cash Flow		Free Cash Flow
-544.38M	-183.65M	271.16M	170.69M	15.84M
	Operating Cash Flow
34.96M	411.87M	457.46M	211.14M	27.93M
	Investing Cash Flow
-507.22M	-585.86M	-87.54M	-140.76M	-24.65M
	Financing Cash Flow
-22.54M	205.25M	-7.26M	412.02M	9.03M

Lynas Rare Earths Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 7.70
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:LYC, the sentiment is Neutral. The current price of 7.7 is below the 20-day moving average (MA) of 8.20, above the 50-day MA of 7.59, and above the 200-day MA of 7.11, indicating a neutral trend. The MACD of 0.19 indicates Positive momentum. The RSI at 49.23 is Neutral, neither overbought nor oversold. The STOCH value of 19.28 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for AU:LYC.

Lynas Rare Earths Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LYC	59 Neutral	$7.79B	153.13	2.27%	―	-20.07%	-74.91%
REE	52 Neutral	AU$20.82M	―	-111.05%	―	-100.00%	33.33%
Sector *	49 Neutral	$1.95B	-1.21	-21.28%	3.72%	1.18%	-30.47%
HAS	33 Underperform	AU$60.44M	―	-86.77%	―	―	-879.59%

Lynas Rare Earths Corporate Events

Lynas Rare Earths Announces Director’s Interest Changes

Lynas Rare Earths Limited announced changes in the director’s interest, specifically involving Amanda Lacaze, with the grant and exercise of Employee Performance Rights and the sale of Ordinary Shares by the Morgan Lacaze Family Trust. These changes reflect adjustments in the company’s equity structure, potentially impacting shareholder value and market perception.

Lynas Rare Earths Issues Unquoted Performance Rights

Lynas Rare Earths Limited announced the issuance of 2,039,303 unquoted performance rights under an employee incentive scheme. These securities are subject to transfer restrictions and are not quoted on the ASX until the restrictions end, indicating a strategic move to align employee interests with company performance.

Lynas Rare Earths Announces Quotation of New Securities on ASX

Lynas Rare Earths Limited announced the quotation of 728,687 ordinary fully paid securities on the Australian Securities Exchange (ASX) as of May 5, 2025. This move follows the cessation of transfer restrictions on securities previously issued under an employee incentive scheme, potentially impacting the company’s market liquidity and investor interest.

Lynas Rare Earths Advances Heavy Rare Earth Production Amid Global Market Shifts

Lynas Rare Earths Limited has commenced commissioning a new Heavy Rare Earth separation circuit, producing Holmium concentrate and beginning Dysprosium separation, with first production expected in May. This positions Lynas as the only commercial producer of separated Heavy Rare Earth products outside China, amid global trade shifts affecting rare earth markets. The company reported quarterly sales revenue of A$123.0 million, with ongoing projects to meet a target production of 10.5kt/annum. Lynas is also progressing on its U.S. project, addressing wastewater management challenges, and engaging with the U.S. Government on additional CAPEX requirements.

Lynas Rare Earths to Announce Quarterly Results on April 28

Lynas Rare Earths Limited announced that it will release its quarterly results for the period ending 31 March 2025 on 28 April 2025. The announcement will be accompanied by a briefing hosted by the company’s CEO, Amanda Lacaze, which will be webcast for analysts and shareholders. This release is significant for stakeholders as it provides insights into the company’s financial performance and strategic direction.

AustralianSuper Increases Stake in Lynas Rare Earths

AustralianSuper Pty Ltd has increased its voting power in Lynas Rare Earths Limited from 8.50% to 9.51%, indicating a growing interest and stake in the company. This change in substantial holding could impact Lynas’ market positioning and influence shareholder decisions, reflecting AustralianSuper’s confidence in the company’s future prospects.

Lynas Rare Earths Updates ASX Announcement with Resource Details

Lynas Rare Earths Limited has re-released its ASX announcement to update a core sample image caption and provide a detailed JORC category breakdown of its Mineral Resource Estimate. This update is part of the company’s ongoing efforts to maintain transparency and accuracy in its resource reporting, which is vital for stakeholders and investors in assessing the company’s resource potential and market positioning.

Lynas Rare Earths Limited Announces 1H FY25 Financial Results

Lynas Rare Earths Limited released its 1H FY25 results presentation, highlighting its financial performance for the half-year ending December 2024. The presentation emphasizes the company’s strategic positioning in the rare earths market amidst various industry risks and market conditions. The release serves as an informational update for shareholders and potential investors, although it does not constitute financial advice or an investment offer.

Lynas Rare Earths Reports Increased Production Amid Market Challenges

Lynas Rare Earths Limited reported a net profit after tax of $5.9 million for the first half of the 2025 financial year, despite a challenging market with lower NdPr prices. The company achieved a 22% increase in NdPr production and a 23% increase in sales volume, leading to a revenue increase to $254.3 million. Lynas made significant progress on major projects, including the expansion of facilities at Mt Weld and Kalgoorlie, and the development of new processing capabilities in Malaysia. These advancements are expected to enhance Lynas’s operational efficiency and sustainability, positioning the company to capitalize on future market improvements.

Lynas Rare Earths Releases Interim Financial Report

Lynas Rare Earths Limited released its interim unaudited consolidated financial report for the half-year ending December 31, 2024. The report provides insights into the company’s financial performance and operational status, which are crucial for stakeholders to assess its market positioning and future prospects.

Lynas Rare Earths to Announce Half Yearly Financial Results

Lynas Rare Earths Limited is set to release its half yearly financial results for the period ending December 31, 2024, on February 26, 2025. The announcement will include a briefing hosted by CEO Amanda Lacaze, providing insights into the company’s operations and financial performance, which is crucial for stakeholders and analysts in understanding Lynas’s market position and future prospects.