Molycorp (MCP) Shares Give Back Gains as JPMorgan Questions Molymet Deal
MCP Hot Sheet
Rating Summary:3 Buy, 5 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 20 | Down: 11 | New: 38
After opening up about 0.8 percent and continuing another 3 percent higher early Wednesday morning, shares of Molycorp (NYSE: MCP) are now well into negative territory as an analyst at JPMorgan issued some intraday cautious comments. The stock last traded at $30.38, down 1.9 percent from Tuesday's close.
Traders were buying earlier after Molycorp announced a $390 million investment from Molymet. JPMorgan's Michael Gambardella, however, doesn't see any strategic benefits from such a deal. More concerning, the timing of the investment without "immediate" use for the cash brings up questions related to the health of the rare earth market and Molycorp's cash flow.
Gambardella maintains a Neutral rating and $39 price target on shares of Molycorp.
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Traders were buying earlier after Molycorp announced a $390 million investment from Molymet. JPMorgan's Michael Gambardella, however, doesn't see any strategic benefits from such a deal. More concerning, the timing of the investment without "immediate" use for the cash brings up questions related to the health of the rare earth market and Molycorp's cash flow.
Gambardella maintains a Neutral rating and $39 price target on shares of Molycorp.
Visit our Analyst Ratings page to track all the market-moving analyst action on shares of Molycorp.
Discover Wall Street's best ratings calls with the pros - Ratings Insider Elite. Free Trial!
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cash not needed
amit shah on Feb 1, 2012 02:11 PMMark as Spam
What is it that made the analyst think that they do not need cash.There are not details that MCP does not need cash,today's date which company would not like to have more cash on hand for future expansions or aquistions.