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MP Materials (MP) to Post Q4 Earnings: What's in Store?

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MP Materials Corp. (MP - Free Report) is scheduled to report fourth-quarter 2022 results after the closing bell on Feb 23.

Q4 Estimates

The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $82.5 million, suggesting a 17% year-over-year decline. The consensus mark for earnings is pegged at 14 cents per share, indicating a 55% plunge from the fourth-quarter 2021 reported figure. The Zacks Consensus Estimate for earnings for the to-be-reported quarter has moved down 13% over the past 30 days.

Q3 Results

In the last reported quarter, MP Materials reported a year-over-year improvement in revenues and earnings. Revenues and earnings per share beat the Zacks Consensus Estimate. MP Material’s earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 21.5%.

MP Materials Corp. Price and EPS Surprise

 

MP Materials Corp. Price and EPS Surprise

MP Materials Corp. price-eps-surprise | MP Materials Corp. Quote

Factors to Note

In the first nine months of 2022, MP produced 32,014 MT REO in concentrate and sold 32,382 MT, both flat compared with the prior year. For the nine months ended Sept 30, 2022, higher ore feed rates largely offset lower ore feed grade compared with the prior-year period. Lower ore feed grade is expected to have impacted the company’s output in the fourth quarter.

Nevertheless, product sales for the period surged 84% to $425 million. This was attributed to an 86% gain in realized price per REO MT, reflecting higher demand for rare earth products. The realized sales price of rare earth oxide is anticipated to have been higher in the fourth quarter due to strong demand and tight supply. Elevated prices are expected to have offset the impact of lower production volumes on the company’s top-line performance in the quarter to be reported.

Higher raw material and logistic costs are likely to have weighed on the performance in the quarter under review. Also, higher personnel and other general and administrative costs, as well as advanced projects and development costs, are anticipated to have dented margins.

Nevertheless, per-unit production costs, owing to continued operational efficiencies, benefits from higher sales volumes and increased realized pricing, driven by higher market prices, are likely to have offset some of these impacts on the company’s bottom-line performance in the quarter to be reported.

What Our Zacks Model Indicates

Our proven model does not conclusively predict an earnings beat for MP Materials this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can see the complete list of today's Zacks #1 Rank stocks here.

You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Earnings ESP: The Earnings ESP for MP Materials is 13.53%.

Zacks Rank: MP currently carries a Zacks Rank #4 (Sell).

Price Performance

 

Zacks Investment Research
Image Source: Zacks Investment Research

 

MP Materials’ shares have fallen 23.2% in the past year compared with the industry’s 8.8% decline.

Stocks Poised to Beat Estimates

Here are some Basic Materials stocks, which, according to, our model, have the right combination of elements to post an earnings beat in their upcoming releases.

Piedmont Lithium (PLL - Free Report) , expected to release earnings on Feb 15, has an Earnings ESP of +8.33% and currently sports a Zacks Rank of 1.

The consensus estimate for Piedmont Lithium’s fourth-quarter earnings has been revised to a loss of 36 cents from the loss of 39 cents reported over the past 30 days.

Teck Resources (TECK - Free Report) , expected to release earnings on Feb 23, has an Earnings ESP of +9.05% and currently carries a Zacks Rank of 3.

The Zacks Consensus Estimate for Teck Resources’ fourth-quarter earnings has been unchanged over the past 30 days. The consensus estimate for TECK’s earnings for the quarter is pegged at 96 cents.

Celanese Corporation (CE - Free Report) , scheduled to release earnings on Feb 23, has an Earnings ESP of +0.37%. CE currently carries a Zacks Rank of 3.

The Zacks Consensus Estimate for CE’s earnings for the fourth quarter is pegged at $1.56.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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