MP Materials (NYSE:MP – Get Free Report) and American Lithium (NASDAQ:AMLI – Get Free Report) are both basic materials companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, valuation, institutional ownership, profitability, earnings and dividends.
Institutional & Insider Ownership
52.5% of MP Materials shares are owned by institutional investors. Comparatively, 7.7% of American Lithium shares are owned by institutional investors. 12.6% of MP Materials shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Volatility & Risk
MP Materials has a beta of 2.23, suggesting that its stock price is 123% more volatile than the S&P 500. Comparatively, American Lithium has a beta of 1.52, suggesting that its stock price is 52% more volatile than the S&P 500.
Analyst Recommendations
Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
MP Materials | 0 | 4 | 6 | 0 | 2.60 |
American Lithium | 0 | 0 | 1 | 1 | 3.50 |
MP Materials currently has a consensus target price of $20.50, indicating a potential upside of 52.64%. American Lithium has a consensus target price of $3.25, indicating a potential upside of 612.72%. Given American Lithium’s stronger consensus rating and higher probable upside, analysts plainly believe American Lithium is more favorable than MP Materials.
Earnings and Valuation
This table compares MP Materials and American Lithium’s gross revenue, earnings per share and valuation.
Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
MP Materials | $206.43 million | 10.76 | $24.31 million | ($0.15) | -89.53 |
American Lithium | N/A | N/A | -$29.55 million | ($0.14) | -3.26 |
MP Materials has higher revenue and earnings than American Lithium. MP Materials is trading at a lower price-to-earnings ratio than American Lithium, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares MP Materials and American Lithium’s net margins, return on equity and return on assets.
Net Margins | Return on Equity | Return on Assets | |
MP Materials | 1.62% | -0.61% | -0.34% |
American Lithium | N/A | -19.40% | -18.92% |
Summary
MP Materials beats American Lithium on 9 of the 14 factors compared between the two stocks.
About MP Materials
MP Materials Corp., together with its subsidiaries, produces rare earth materials. The company owns and operates the Mountain Pass Rare Earth mine and processing facility in North America. It holds the mineral rights to the Mountain Pass mine and surrounding areas, as well as intellectual property rights related to the processing and development of rare earth minerals. The company was founded in 2017 and is headquartered in Las Vegas, Nevada.
About American Lithium
American Lithium Corp., an exploration and development stage company, engages in the acquisition, exploration, and development of resource properties in the United States. It principally focuses on the TLC Lithium Project located in the town of Tonopah, Nevada; and the Falchani Lithium project and the Macusani Uranium project located in Puno, Peru. The company was formerly known as Menika Mining Ltd. and changed its name to American Lithium Corp. in April 2016. American Lithium Corp. was incorporated in 1974 and is based in Vancouver, Canada.
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