MP Materials (MP) AI Stock Analysis

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MP Materials

(NYSE:MP)

Rating:51Neutral

Price Target:

$24.50

▼(-4.67%Downside)

MP Materials' stock score is primarily impacted by financial challenges, including declining revenues and negative cash flow. While technical indicators suggest some positive momentum, the lack of earnings and dividends, combined with strategic challenges, weigh on the valuation.

Positive Factors

Government Support

MP was awarded a $35M contract through the U.S. Department of Defense to support the construction of a commercial scale processing facility for heavy rare earth elements at Mountain Pass.

Market Opportunities

The temporary supply shock from China's export ban on rare earths could encourage Western OEMs to diversify their supply chains, potentially benefiting MP Materials.

Strategic Partnerships

The collaboration with Ma'aden focuses on establishing a fully vertically integrated, end-to-end rare earth supply chain in Saudi Arabia.

Negative Factors

Financial Performance

MP is expected to post negative free cash flow in 2025 and 2026 due to soft NdPr prices caused by an oversupplied market.

Production Limitations

MP's Fort Worth magnet facility's projected output is currently less than 1% of global demand, which may limit the company's near-term attempts to scale significantly.

Trade Uncertainties

China's export controls on medium and heavy rare earth elements could limit attempts to build scaled NdFeB magnet production outside of China.

MP Materials (MP) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$4.20B

Dividend YieldN/A

Average Volume (3M)6.67M

Price to Earnings (P/E)―

Beta (1Y)0.76

Revenue Growth4.63%

EPS Growth-3189.81%

CountryUS

Employees804

SectorBasic Materials

Sector Strength62

IndustryIndustrial Materials

Share Statistics

EPS (TTM)-0.12

Shares Outstanding163,456,300

10 Day Avg. Volume9,376,683

30 Day Avg. Volume6,672,414

Financial Highlights & Ratios

PEG Ratio0.74

Price to Book (P/B)4.06

Price to Sales (P/S)0.00

P/FCF Ratio-24.17

Enterprise Value/Market Cap0.97

Enterprise Value/Revenue5.24

Enterprise Value/Gross Profit844.29

Enterprise Value/Ebitda189.89

Forecast

1Y Price Target

$27.86

Price Target Upside8.40% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering8

MP Materials Business Overview & Revenue Model

Company DescriptionMP Materials Corp. is a leading producer of rare earth materials and is primarily involved in the mining and processing of rare earth elements (REEs). The company operates the Mountain Pass mine in California, one of the largest rare earth mines outside of China. MP Materials focuses on producing materials that are essential for modern technologies, including magnets used in electric vehicles, wind turbines, and various electronics.

How the Company Makes MoneyMP Materials generates revenue through the extraction, processing, and sale of rare earth materials. The primary revenue stream comes from selling rare earth oxide concentrates, which are essential components in the manufacturing of high-performance magnets. These magnets are crucial for various industries, including automotive, renewable energy, and electronics. The company benefits from strategic partnerships with manufacturers and suppliers who require a stable and reliable source of rare earth materials. Furthermore, MP Materials is actively working on vertically integrating its operations to further enhance profitability by controlling more stages of the supply chain, from mining to the production of rare earth magnets.

MP Materials Key Performance Indicators (KPIs)

Any

REO Production Volume

REO Production Volume
Monitors the amount of rare earth oxide produced, indicating the company's operational capacity and efficiency in extracting valuable materials.

Chart InsightsMP Materials' REO production volume has shown volatility, with a notable surge in Q3 2024. This aligns with strategic shifts highlighted in their earnings call, where they emphasized increased domestic production and halted exports to China due to geopolitical tensions. Despite challenges like reduced EBITDA, the company is focusing on expanding its U.S. supply chain, evidenced by a significant rise in NdPr sales and new partnerships. This strategic pivot could bolster long-term growth, positioning MP Materials as a key player in the domestic rare earth market.

Data provided by:

Main Street Data

MP Materials Earnings Call Summary

Earnings Call Date:May 08, 2025

(Q1-2025)

% Change Since: 7.76%|

Next Earnings Date:Jul 31, 2025

Earnings Call Sentiment Neutral

The earnings call presented a mixed sentiment. While there were significant achievements in production and strategic positioning, challenges such as halted shipments to China and declines in EBITDA and EPS were noted. However, the company's position as a national leader and its engagement with government and industry partners suggests a positive long-term outlook.

Q1-2025 Updates

Positive Updates

Record NdPr Oxide Production

Achieved record NdPr oxide production of 563 metric tons, a 36% sequential increase from the previous quarter.

Revenue Growth

Consolidated revenue increased by 25% year-over-year, driven by a 246% increase in NdPr sales volumes.

Magnetics Division Milestone

Began initial on-spec metal production for General Motors, marking a significant milestone as the first NdPr metal production at scale in the U.S.

Strategic National Positioning

Positioned as America's national champion in rare earth magnetics, with increased engagement from both government and industry.

Magnetic Division Performance

Magnetics Division recorded $5.2 million in revenue and turned EBITDA positive in the quarter.

Negative Updates

Consolidated Adjusted EBITDA Decline

Consolidated adjusted EBITDA declined $1.5 million year-over-year to negative $2.7 million, driven by the transition to producing separated products.

Challenges in China

Halted shipments of rare earth concentrate to China due to geopolitical tensions, impacting the supply chain strategy.

Adjusted Diluted EPS Decline

Adjusted diluted EPS fell from negative $0.04 a year ago to negative $0.12 this year, primarily due to higher interest expense and depreciation.

Company Guidance

During the MP Materials First Quarter 2025 Earnings Call, the company provided guidance on its recent strategic and operational advancements. MP Materials reported a record production of NdPr oxide at 563 metric tons, a 36% sequential increase, and achieved its second highest quarterly production of REO. The company emphasized the geopolitical importance of establishing a domestic rare earth supply chain due to China's recent tariffs and export restrictions. MP Materials halted shipments of rare earth concentrate to China, focusing instead on non-Chinese markets like Japan and Korea. They also recorded $5.2 million in revenue from initial metal production for General Motors, marking a significant milestone for domestic NdPr metal production. The company highlighted a 25% year-over-year increase in consolidated revenue, driven by a 246% rise in NdPr sales volumes, despite an adjusted EBITDA decline of $1.5 million to negative $2.7 million. MP Materials is actively discussing partnerships with major commercial and government stakeholders to accelerate its mission, leveraging its vertically integrated model to enhance the U.S. rare earth magnetic supply chain.

MP Materials Financial Statement Overview

Summary

MP Materials is facing financial headwinds with declining revenues and profitability. The balance sheet remains stable with low leverage, but negative cash flow trends highlight liquidity concerns. Improvement in revenue generation and operational efficiency is needed.

Income Statement

Neutral

MP Materials' TTM revenue has declined compared to previous years, with an evident drop in profitability marked by negative EBIT and net income margins. The company is facing challenges in maintaining its revenue growth and profitability, which is evident from the negative EBIT and EBITDA margins.

Balance Sheet

Neutral

The company maintains a relatively low debt-to-equity ratio, indicating prudent leverage management. However, the return on equity has turned negative due to losses, impacting overall shareholder value. The equity ratio remains stable, suggesting asset financing primarily through equity.

Cash Flow

Negative

MP Materials is experiencing negative operating and free cash flows, indicating potential liquidity challenges. The operating cash flow to net income ratio has weakened, reflecting inefficiencies in converting earnings to cash.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
215.98M	203.85M	253.44M	527.51M	331.95M	134.31M
	Gross Profit
4.83M	-66.79M	105.02M	416.94M	231.32M	31.91M
	EBIT
-169.13M	-169.43M	22.28M	327.41M	165.34M	25.23M
	EBITDA
-34.87M	8.65M	94.95M	366.77M	195.86M	-25.27M
	Net Income Common Stockholders
-104.56M	-65.42M	24.31M	289.00M	135.04M	-21.82M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
947.46M	850.87M	997.84M	1.18B	1.18B	519.65M
	Total Assets
2.35B	2.33B	2.34B	2.24B	1.89B	1.07B
	Total Debt
943.66M	914.53M	688.81M	678.44M	691.82M	70.82M
	Net Debt
646.50M	632.09M	425.46M	541.82M	-487.48M	-448.84M
	Total Liabilities
1.22B	1.28B	970.67M	925.15M	880.93M	220.41M
	Stockholders Equity
1.14B	1.05B	1.37B	1.31B	1.01B	853.88M
Cash Flow		Free Cash Flow
-173.77M	-173.07M	-199.20M	16.92M	-21.90M	-19.09M
	Operating Cash Flow
-8.72M	13.35M	62.70M	343.51M	101.97M	3.28M
	Investing Cash Flow
-46.36M	10.06M	68.70M	-1.36B	-119.36M	-22.37M
	Financing Cash Flow
-42.71M	-4.79M	-9.92M	-24.19M	666.11M	521.96M

MP Materials Technical Analysis

Technical Analysis Sentiment

Positive

Last Price25.70

Price Trends

50DMA

23.29

Positive

100DMA

23.48

Positive

200DMA

20.39

Positive

Market Momentum

MACD

0.22

Negative

RSI

62.89

Neutral

STOCH

86.42

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MP, the sentiment is Positive. The current price of 25.7 is above the 20-day moving average (MA) of 21.37, above the 50-day MA of 23.29, and above the 200-day MA of 20.39, indicating a bullish trend. The MACD of 0.22 indicates Negative momentum. The RSI at 62.89 is Neutral, neither overbought nor oversold. The STOCH value of 86.42 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MP.

MP Materials Risk Analysis

MP Materials disclosed 43 risk factors in its most recent earnings report. MP Materials reported the most risks in the “Production” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 2 New Risks

A recent decision of the Delaware Court of Chancery in Garfield v. Boxed, Inc. may create uncertainty regarding the validity of some of our authorized and issued shares of common stock. Q4, 2022

Increased scrutiny regarding our sustainability and ESG practices could impact our reputation and our stock price. Q4, 2022

MP Materials Peers Comparison

Overall Rating

UnderperformOutperform

Sector (51)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AA	72 Outperform	$7.25B	8.29	17.53%	1.43%	21.56%	―
CMT	70 Outperform	$144.32M	12.03	8.01%	―	-15.07%	-36.06%
CDE	69 Neutral	$5.99B	33.05	6.44%	―	41.79%	―
CE	56 Neutral	$6.07B	6.84	-26.94%	2.63%	-5.98%	-183.27%
MP	51 Neutral	$4.20B	―	-9.62%	―	4.63%	-3189.81%
Sector *	51 Neutral	$2.02B	-1.14	-21.37%	3.64%	2.88%	-30.57%
ALB	50 Neutral	$7.04B	―	-10.58%	2.70%	-39.34%	-500.52%

* Basic Materials Sector Average

Performance Comparison

MP Materials

25.70

10.71

71.45%

ALB

Albemarle

59.83

-52.21

-46.60%

Alcoa

28.01

-12.65

-31.11%

Celanese

55.46

-87.78

-61.28%

CDE

Coeur Mining

9.37

3.92

71.93%

CMT

Core Molding Technologies

16.05

-0.56

-3.37%

MP Materials Corporate Events

Executive/Board Changes

MP Materials Appoints New Chief Accounting Officer

Neutral

Apr 4, 2025

On April 4, 2025, MP Materials Corp. appointed David G. Infuso as the Chief Accounting Officer and principal accounting officer, succeeding Ryan Corbett who remains the Chief Financial Officer. Mr. Infuso, who joined the company in November 2020, has extensive experience in accounting and finance, having previously worked at Penn Entertainment, Inc. and Pinnacle Entertainment, Inc. His new role comes with an employment agreement that includes a base salary of $315,000, eligibility for a discretionary bonus, and various benefits in case of termination. The appointment and associated compensation package highlight MP Materials’ commitment to strengthening its financial leadership team.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.