Ann: Annual Report FY2023, page-12

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0.8

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4

BROKER	DATE	RATING	RECOMMENDATION	TARGET PRICE	% TO REACH TARGET
UBS	13/10/2023	1	Upgrade to Buy from Neutral	$8.00	17.30%
COMMENTARY Given both share price weakness and recovery in rare earth pricing, UBS has lifted its rating on Lynas Rare Earths. The company's stock has declined -10% since July, as rare earth prices have climbed 22%. For the broker, ramp-up at the Kalgoorlie site remains a risk, but the company does guide to first mixed rare earth concentrate from September. The rating is upgraded to Buy from Neutral and the target price of $8.00 is retained. FORECAST UBS forecasts a full year FY24 EPS of 12.00 cents. UBS forecasts a full year FY25 EPS of 44.00 cents.
Macquarie	30/08/2023	1	Outperform	$7.70	12.90%
COMMENTARY FY23 earnings from Lynas Rare Earths were broadly in line with Macquarie's estimates. The broker increases expenditure estimates for Kalgoorlie to match the company's revised project guidance of -$730m as costs escalated. The major de-risking event will be achieving first production at Kalgoorlie, expected in the September quarter. Macquarie also lifts estimates for Mount Weld capital expenditure by 20% to -$600m. Outperform retained. Target is steady at $7.70. FORECAST Macquarie forecasts a full year FY24 dividend of 0.00 cents and EPS of 41.50 cents. Macquarie forecasts a full year FY25 dividend of 0.00 cents and EPS of 75.50 cents.
Citi	30/08/2023	3	Neutral	$7.35	7.77%
COMMENTARY FY23 EBITDA beat Citi's estimates. On further analysis of the results the broker upgrades earnings estimates by 17% for FY24 and by 3% for FY25 because of lower operating costs and higher financial income. This is slightly offset by downward adjustments to rare earths prices and sales volumes. The broker points out prices remain relatively depressed, with current spot prices implying FY24 earnings down -70%. Neutral retained. Target is reduced to $7.35 from $7.60. FORECAST Citi forecasts a full year FY24 dividend of 0.00 cents and EPS of 26.30 cents. Citi forecasts a full year FY25 dividend of 0.00 cents and EPS of 44.30 cents.
Bell Potter	30/08/2023	1	Buy	$8.50	24.63%
COMMENTARY Lynas Rare Earths FY23 results saw profit ahead of Bell Potter on revenue below and a higher cost of goods sold. FY23, by all intents and purposes was a successful year, the broker suggests. This is despite production issues and weaker NdPr prices. Production of NdPr increased 4% year on year to an all-time record, beating Bell Potter's numbers. The immediate future is a little murkier as costs are likely to remain at current levels or higher as operations transition to Kalgoorlie from Malaysia. Finished product stockpiling will continue over the first half which should smooth the sales profile over FY24. Lynas is a high-quality business, Bell Potter suggests, and a key supplier of separated rare earths to Western economies. The broker sees the business as being well placed to weather any issues as it transitions operations over the next six months. Target rises to $8.50 from $7.80, Buy retained. FORECAST Bell Potter forecasts a full year FY24 dividend of 0.00 cents and EPS of 31.90 cents. Bell Potter forecasts a full year FY25 dividend of 0.00 cents and EPS of 43.50 cents.