Index Membership: N/A
Sector: Basic Materials
No current mining, negative earnings, about 2 years old, 71 employees vs 59,000 for Alcoa, but still about a third the market cap of Alcoa which is, BTW, over 100 years old and makes money.
Industry: Industrial Metals & Minerals
Full Time Employees: 71
Molycorp, Inc., a development stage company, focuses on the production and sale of rare earth oxides (REOs) from stockpiled feedstocks in the western hemisphere. It operates the Mountain Pass mine, a non-Chinese rare earth deposit. The company was founded in 2008 and is based in Greenwood Village, Colorado.
in the short term, you are right. in the longer view you are not.
i am counting on those shares to be dumped into the market. i see it as a buying opportunity. i am bullish long term, but i am not stupid.
just the first of many i have read. just the first my search stumbled over.
what china is doing now is not an embargo. they are trying to get industry to relocate to china to get favorable pricing on REEs. an embargo implies an artificial price control by controlling supply. china will sell you all you want, for a decent price, all day every day. all you have to do is build a factory in china and employ chinese workers. if the plant is in california using americans, then you pay a higher price for limited supplies, to manufacture something you will have to sell at a non competitive price.
you assume the chinese are playing the game by your rules. they are not. they are making there own rules, making everybody else like it. if you can't see that, then you will lose your shirt.
i think you should look up the word saturated in the dictionary. it doesn't mean what you think it does. 97% of supply indicates there is virtually no other source. if they supplied 97% of the worlds demand, then saturated might apply.
china may supply 97% of the worlds supply, but they do not supply 97% of the worlds demand. if they did, MCP would never have been brought to market. as it is, i'm making money off the hysteria the demand is causing.
currently i'm out. may just have to jump back in in a couple weeks.
This is an area of confusion, but Yahoo has revised their prior earnings release to March. I have Feb $55 puts so will have to sell or exercise them by mid Feb, but will likely hold my MCP short position until 4 days after the March "earnings", as last time MCP tanked 34% in 4 days on its negative earnings. Since they are still not producing any product to sell, I think it is a safe bet that they will get clobbered again.
With lockup selling, sumitomo dilution, and crap earnings, I see $28 as a very realistic possibility by then.
I just mean profit over what the mine itself was bought for, something like only $85 million. They bought it from Chevron, which bought it previously from another company which ran it but had to shut it down because of environmental issues.
So, while there might have been some other incorportation costs, the big investment they made was just buying a mine. At one point they had turned that 85 million dollar mine into 5 billion in market cap, thus the huge multibagger.
Of course, they cant spend MCP stock, they have to sell in 2 weeks when the lockup expires, otherwise they have a "paper" 50 bagger and they cant tell their friends lol hahhahaha.