A very simple point. If Any country is going to bring a product on shore and compete with China they will have to source materials as inexpensively as they can. I doubt any manufacture will import NdPrO directly. They will import magnetic material or finished magnets. or based on current patterns probably finished motors with made in China stickers on them. Look at Tesla and VW even their cars Made out side of China All use Motors including traction motors made in China. Look at Ford and GM their cars use Motors made in China for windows power steering fans and everything else. No matter what country they are assembled in. I no longer have my GTO which was made in AU. Every motor I looked at was Made in China. Lynas and MP will have small metal and magnet operations in US in a few years. The announced plans is for limited capacity at this time. So if you want to talk more than 5 years out it may help Lynas. Less than 5 years you will need to look at what is happening and explain how it could help Lynas selling NdPrO.
It took multiple decades to wrap us so completely into China it will take a couple to unwrap even 60% of that. Think back to the late 80s early 90s. Japan was the primary shipper to US and many in US were sure they would dominate US. I remember when i was in high school my father made me take German because he knew that Germany was going to dominate the world because of their Engineering and Manufacturing.
JMO some manufacturing will move out of China to traditional manufactures. US, EU, Japan. Most will go to small countries in Ashia. After that maybe something somewhere else. Maybe the moon in a 100 years. The cycle will continue it will not stop in any one place. People exposed to this for first time will see only doom and gloom. Just like my father in the 60s with Germany, and me with Japan. The US Germany and Japan are still very strong competitors in world markets they just are not dominating. China will follow same path.
Later this year? Just like many people, including me, you think things will happen faster than they will. Look at my predictions on Profits and earnings. Lynas has come in lower for about 2 years than I predicted ( one exception). My prediction on SP have been low and early. Things always take longer than we think. Even when we use solid data to estimate them. Earnings can give an idea as to stock prices but it cannot take in the emotions people feel That is why Lynas currently has a PE of 26 to day and will go much higher in August when the TMM has the 2023 AR shifted off and the 2024 AR replacing it, unless the SP drops. Which it will question is when. I realy thought the SP would drop with the SAR to keep the PE at about 20. Oh well right on EPS wrong on how people would react. With TMM earnings at AUD 0.22 Share and a PE of 20 the stock price would be $4.40 yet it is $5.69 The AR will be very bad YOY that should lower EPS dramatically with lower earnings / Share. Who knows how people will react. I just cannot imagine a stock with two years of declining EPS and Revenue suporting a PE over 20 if share price does not drop to below 5.00 PE will be about 30
LYC Price at posting:
$5.69 Sentiment: Sell Disclosure: Not Held
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