Mining Stocks: Risks and Opportunities for Investors
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Should l Buy TMC?
Source: Fool
- TMC Overview: TMC The Metals Company focuses on collecting polymetallic nodules from the Pacific Ocean, currently valued at $2.7 billion with a 13.45% stock increase to $6.41; despite being pre-revenue, its eco-friendly mining approach may attract long-term investors.
- Importance of MP Materials: MP Materials operates the only large-scale rare-earth mine in the U.S., valued at $11 billion with an 8.49% stock increase to $61.35; it secured a $400 million investment from the Department of Defense and a $500 million partnership with Apple, ensuring stability in the U.S. rare-earth supply chain.
- USA Rare Earth Development: USA Rare Earth controls the Round Top deposit in Texas, valued at $3.2 billion with a 6.02% stock increase to $21.84; although still in the construction phase, it has raised $3.1 billion to support the establishment of a domestic rare-earth supply chain.
- Investment Outlook: While TMC, MP, and USA Rare Earth are all pre-revenue and face market volatility risks, their potential in the rare-earth and battery metal sectors makes them attractive for long-term investors.
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Analyst Views on TMC
Wall Street analysts forecast TMC stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for TMC is 8.33 USD with a low forecast of 6.50 USD and a high forecast of 11.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
3 Analyst Rating
3 Buy
0 Hold
0 Sell
Strong Buy
Current: 5.650
Low
6.50
Averages
8.33
High
11.00
Current: 5.650
Low
6.50
Averages
8.33
High
11.00
About TMC
TMC the metals company Inc. is a deep-sea minerals exploration company. The Company is focused on the collection and processing of polymetallic nodules found on the seafloor in international waters of the Clarion Clipperton Zone in the Pacific Ocean (CCZ), located approximately 1,300 nautical miles southwest of San Diego, California. The CCZ is a geological submarine fracture zone of abyssal plains and other formations in the Eastern Pacific Ocean, with a length of around 4,500 miles that spans approximately 1,737,000 square miles. These nodules contain high grades of four metals (nickel, copper, cobalt, manganese) which can be used as feedstock for battery cathode precursors (nickel, cobalt and manganese sulfates, or intermediate nickel-copper-cobalt matte) for electric vehicles (EV) and energy storage markets; copper cathode for EV wiring, energy transmission and other applications, and manganese silicate for manganese alloy production required for steel production.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Mining Stocks: Risks and Opportunities for Investors
- TMC Overview: TMC The Metals Company focuses on collecting polymetallic nodules from the Pacific Ocean, currently valued at $2.7 billion with a 13.45% stock increase to $6.41; despite being pre-revenue, its eco-friendly mining approach may attract long-term investors.
- Importance of MP Materials: MP Materials operates the only large-scale rare-earth mine in the U.S., valued at $11 billion with an 8.49% stock increase to $61.35; it secured a $400 million investment from the Department of Defense and a $500 million partnership with Apple, ensuring stability in the U.S. rare-earth supply chain.
- USA Rare Earth Development: USA Rare Earth controls the Round Top deposit in Texas, valued at $3.2 billion with a 6.02% stock increase to $21.84; although still in the construction phase, it has raised $3.1 billion to support the establishment of a domestic rare-earth supply chain.
- Investment Outlook: While TMC, MP, and USA Rare Earth are all pre-revenue and face market volatility risks, their potential in the rare-earth and battery metal sectors makes them attractive for long-term investors.
See More
MP Stock Plummets Amid Vance and Rubio's Discussion on Critical Minerals
- Event Announcement: Secretary of State Marco Rubio is hosting the inaugural Critical Minerals Ministerial in Washington, D.C. on Wednesday.
- Focus of the Meeting: The ministerial aims to address issues related to critical minerals, which are essential for various industries and technologies.
- Significance: This event highlights the importance of securing a stable supply of critical minerals for national security and economic growth.
- Participants: The meeting is expected to involve discussions among key stakeholders, including government officials and industry leaders.
See More
Trump Seeks a Stockpile of Critical Minerals: Implications for MP Stock.
- Investor Confusion: Investors in MP Materials and other rare earths and critical minerals are facing uncertainty due to recent developments in the market.
- Mineral Stockpile Plan: A new plan to launch a mineral stockpile adds to the complexity of the situation for investors.
See More
Trump Administration's Policy Shift on Rare Earths Shakes Market
- Policy Shift Impact: The Trump administration informed industry leaders that future rare earth projects must demonstrate “financial independence” without federal price supports, marking a significant reversal from last year's aggressive rhetoric, which could undermine the competitiveness of the U.S. rare earth supply chain.
- Market Reaction: The news triggered a steep sell-off in rare earth and critical minerals stocks, with companies like MP Materials and U.S. Antimony experiencing significant declines, reflecting strong market concerns over policy uncertainty that may affect investor confidence.
- Industry Pushback: MP Materials labeled the report as “fake news” on social media, emphasizing that its existing government contract, which includes a price floor of $110/kg, remains intact, demonstrating the company's determination to counter misleading narratives and protect its interests.
- Clarification Controversy: Following the report's publication, Reuters edited the content, initially implying that existing agreements were being rescinded, later clarifying that the pivot applies only to future projects, raising questions among industry observers about the media's influence on market sentiment.
See More
Rare Earth Stocks Gain Attention Amid U.S.-China Trade Tensions
- MP Materials Strategy: MP Materials operates the only large-scale rare earth mining and processing site in North America at Mountain Pass, planning to increase its annual production capacity from 1,000 to 10,000 metric tons through the new 10X Facility to meet demand in the electric vehicle and consumer electronics markets.
- Seabed Mining Innovation: The Metals Company aims to extract polymetallic nodules rich in nickel, copper, and cobalt from international waters, having submitted a commercial recovery permit application to NOAA, with permit approval expected by late 2026, although commercial production won't start until 2029.
- USA Rare Earth Acquisition and Expansion: USA Rare Earth is building a facility in Oklahoma to produce rare earth magnets and has secured raw material supply by acquiring Less Common Metals for $100 million, with commercial production on track to begin in the first quarter of this year.
- Government Investment Support: The Trump administration announced a $1.6 billion investment in USA Rare Earth, acquiring a 10% equity stake to bolster the domestic rare earth supply chain, highlighting the government's commitment to reducing reliance on China.
See More
Rare Earth Stocks Surge Due to Government Funding Support
- Market Volatility: Rare earth stocks experienced significant declines in after-hours trading on Wednesday following a Reuters report suggesting the U.S. might scale back minimum price support for critical mineral projects, with USA Rare Earth tumbling over 10% and MP Materials down 8%, indicating market sensitivity to government policy changes.
- Shift in Government Support: The report highlighted a potential pullback in guaranteed pricing for rare earth projects due to a lack of congressional funding, marking a shift in the Trump administration's commitments to the industry, which could impact future investment confidence.
- MP Materials' Rebuttal: MP Materials publicly refuted the Reuters report as “inaccurate and misleading,” asserting that there has been no change to their contract with the government, reflecting the company's strong opposition to market rumors and aiming to stabilize investor confidence.
- Retail Sentiment Shift: While overall market sentiment dipped, retail sentiment for MP Materials improved from 'bullish' to 'extremely bullish,' indicating increased investor confidence in the company, which may provide support for its future stock price.
See More
Mining Stocks: Risks and Opportunities for Investors
- TMC Overview: TMC The Metals Company focuses on collecting polymetallic nodules from the Pacific Ocean, currently valued at $2.7 billion with a 13.45% stock increase to $6.41; despite being pre-revenue, its eco-friendly mining approach may attract long-term investors.
- Importance of MP Materials: MP Materials operates the only large-scale rare-earth mine in the U.S., valued at $11 billion with an 8.49% stock increase to $61.35; it secured a $400 million investment from the Department of Defense and a $500 million partnership with Apple, ensuring stability in the U.S. rare-earth supply chain.
- USA Rare Earth Development: USA Rare Earth controls the Round Top deposit in Texas, valued at $3.2 billion with a 6.02% stock increase to $21.84; although still in the construction phase, it has raised $3.1 billion to support the establishment of a domestic rare-earth supply chain.
- Investment Outlook: While TMC, MP, and USA Rare Earth are all pre-revenue and face market volatility risks, their potential in the rare-earth and battery metal sectors makes them attractive for long-term investors.
See More
MP Stock Plummets Amid Vance and Rubio's Discussion on Critical Minerals
- Event Announcement: Secretary of State Marco Rubio is hosting the inaugural Critical Minerals Ministerial in Washington, D.C. on Wednesday.
- Focus of the Meeting: The ministerial aims to address issues related to critical minerals, which are essential for various industries and technologies.
- Significance: This event highlights the importance of securing a stable supply of critical minerals for national security and economic growth.
- Participants: The meeting is expected to involve discussions among key stakeholders, including government officials and industry leaders.
See More
Trump Seeks a Stockpile of Critical Minerals: Implications for MP Stock.
- Investor Confusion: Investors in MP Materials and other rare earths and critical minerals are facing uncertainty due to recent developments in the market.
- Mineral Stockpile Plan: A new plan to launch a mineral stockpile adds to the complexity of the situation for investors.
See More
Trump Administration's Policy Shift on Rare Earths Shakes Market
- Policy Shift Impact: The Trump administration informed industry leaders that future rare earth projects must demonstrate “financial independence” without federal price supports, marking a significant reversal from last year's aggressive rhetoric, which could undermine the competitiveness of the U.S. rare earth supply chain.
- Market Reaction: The news triggered a steep sell-off in rare earth and critical minerals stocks, with companies like MP Materials and U.S. Antimony experiencing significant declines, reflecting strong market concerns over policy uncertainty that may affect investor confidence.
- Industry Pushback: MP Materials labeled the report as “fake news” on social media, emphasizing that its existing government contract, which includes a price floor of $110/kg, remains intact, demonstrating the company's determination to counter misleading narratives and protect its interests.
- Clarification Controversy: Following the report's publication, Reuters edited the content, initially implying that existing agreements were being rescinded, later clarifying that the pivot applies only to future projects, raising questions among industry observers about the media's influence on market sentiment.
See More
Rare Earth Stocks Gain Attention Amid U.S.-China Trade Tensions
- MP Materials Strategy: MP Materials operates the only large-scale rare earth mining and processing site in North America at Mountain Pass, planning to increase its annual production capacity from 1,000 to 10,000 metric tons through the new 10X Facility to meet demand in the electric vehicle and consumer electronics markets.
- Seabed Mining Innovation: The Metals Company aims to extract polymetallic nodules rich in nickel, copper, and cobalt from international waters, having submitted a commercial recovery permit application to NOAA, with permit approval expected by late 2026, although commercial production won't start until 2029.
- USA Rare Earth Acquisition and Expansion: USA Rare Earth is building a facility in Oklahoma to produce rare earth magnets and has secured raw material supply by acquiring Less Common Metals for $100 million, with commercial production on track to begin in the first quarter of this year.
- Government Investment Support: The Trump administration announced a $1.6 billion investment in USA Rare Earth, acquiring a 10% equity stake to bolster the domestic rare earth supply chain, highlighting the government's commitment to reducing reliance on China.
See More
Rare Earth Stocks Surge Due to Government Funding Support
- Market Volatility: Rare earth stocks experienced significant declines in after-hours trading on Wednesday following a Reuters report suggesting the U.S. might scale back minimum price support for critical mineral projects, with USA Rare Earth tumbling over 10% and MP Materials down 8%, indicating market sensitivity to government policy changes.
- Shift in Government Support: The report highlighted a potential pullback in guaranteed pricing for rare earth projects due to a lack of congressional funding, marking a shift in the Trump administration's commitments to the industry, which could impact future investment confidence.
- MP Materials' Rebuttal: MP Materials publicly refuted the Reuters report as “inaccurate and misleading,” asserting that there has been no change to their contract with the government, reflecting the company's strong opposition to market rumors and aiming to stabilize investor confidence.
- Retail Sentiment Shift: While overall market sentiment dipped, retail sentiment for MP Materials improved from 'bullish' to 'extremely bullish,' indicating increased investor confidence in the company, which may provide support for its future stock price.
See More
