Molycorp (MCP) Share Price Needs To Catch Up With Surging Rare Earth Prices - JP Morgan
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Price: $0.36 --0%
Rating Summary:
2 Buy, 6 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
2 Buy, 6 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Analysts at JPMorgan made positive comments on Molycorp, Inc. (NYSE: MCP) today, noting that shares have essentially traded sideways since its secondary offering in mid-February despite the 45% surge in rare earth prices since that time.
Now the stock needs to play catch up.
"We think MCP's stock price, however, should start to catch up as investors become more aware of this recent surge and get a better understanding of the impact on MCP's NPV, even at much lower, long-term rare earth prices levels," analyst Michael F. Gambardella said.
Coming up with his $65 price target, Gambardella is already assuming a 66% reduction from current spot rare earth prices. "In fact, if we assumed current rare earth prices just stayed flat, MCP's NPV would be $215/share and our 2014 EPS would be $38," he shockingly states.
While the firm is maintaining their $65 price target on Molycorp, they believe rising rare earch prices should be a catalyst for MCP's stock and push it higher.
Shares of Molycorp are up 2.6% in early trading Tuesday.
Now the stock needs to play catch up.
"We think MCP's stock price, however, should start to catch up as investors become more aware of this recent surge and get a better understanding of the impact on MCP's NPV, even at much lower, long-term rare earth prices levels," analyst Michael F. Gambardella said.
Coming up with his $65 price target, Gambardella is already assuming a 66% reduction from current spot rare earth prices. "In fact, if we assumed current rare earth prices just stayed flat, MCP's NPV would be $215/share and our 2014 EPS would be $38," he shockingly states.
While the firm is maintaining their $65 price target on Molycorp, they believe rising rare earch prices should be a catalyst for MCP's stock and push it higher.
Shares of Molycorp are up 2.6% in early trading Tuesday.
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