MP Materials Corp. (NYSE:MP) Just Released Its First-Quarter Results And Analysts Are Updating Their Estimates

It's been a sad week for MP Materials Corp. (NYSE:MP), who've watched their investment drop 16% to US$21.14 in the week since the company reported its quarterly result. Revenues of US$61m were in line with expectations, although statutory losses per share were US$0.14, some 11% smaller than was expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Our free stock report includes 1 warning sign investors should be aware of before investing in MP Materials. Read for free now.

After the latest results, the eight analysts covering MP Materials are now predicting revenues of US$261.8m in 2025. If met, this would reflect a substantial 21% improvement in revenue compared to the last 12 months. Losses are predicted to fall substantially, shrinking 23% to US$0.50. Before this earnings announcement, the analysts had been modelling revenues of US$305.9m and losses of US$0.54 per share in 2025. So there's been quite a change-up of views after the recent consensus updates, withthe analysts making a serious cut to their revenue forecasts while also reducing the estimated losses the business will incur.

Check out our latest analysis for MP Materials

There was no major change to the US$26.42average price target, suggesting that the adjustments to revenue and earnings are not expected to have a long-term impact on the business. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic MP Materials analyst has a price target of US$32.00 per share, while the most pessimistic values it at US$18.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the MP Materials' past performance and to peers in the same industry. The analysts are definitely expecting MP Materials' growth to accelerate, with the forecast 29% annualised growth to the end of 2025 ranking favourably alongside historical growth of 7.2% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 4.3% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that MP Materials is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. They also downgraded MP Materials' revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. With that said, earnings are more important to the long-term value of the business. The consensus price target held steady at US$26.42, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for MP Materials going out to 2027, and you can see them free on our platform here.

You still need to take note of risks, for example - MP Materials has 1 warning sign we think you should be aware of.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.