What’s the outlook for the Lynas share price in FY23?

Three business people stand on platforms in the desert and look out through telescopes.Three business people stand on platforms in the desert and look out through telescopes.

The Lynas Rare Earths Ltd (ASX: LYC) share price is falling today, currently down 2.97% at $8.17.

Investors have sold down Lynas shares since 28 June, with the stock pushing to six-month lows of $7.54 apiece on 12 July (as seen in the graph below).

But what might be in store for the mineral explorer for the rest of FY23?

TradingView Chart

What next for the Lynas share price?

The Lynas share price made a strong start to the week following the release of the company’s Q4 FY22 earnings report.

In it, the rare earths producer reported a 10% dip in sales but grew cash receipts 34% to a record $350 million. Growth was underscored by robust pricing and strong demand for rare earths.

Noteworthy is that neodymium and praseodymium (NdPr) prices were roughly 70–80% higher year on year, Lynas said.

Additionally, Lynas reported sales revenue of $294.5m, which it said was the second highest quarterly result recorded. This was achieved despite slightly lower production, mainly due to water shortages in Malaysia.

Macquarie analysts are bullish on the Lynas share price, with the broker rating it a buy. It also values the company at $12.50 per share, as my Foolish colleague Tristan Harrison reported today. Macquarie says Lynas is valued at 10 times FY23 estimated earnings.

Moreover, Lynas is rated a buy from two out of three of the analysts covering the share, according to Refinitiv Eikon data.

The average price target from this list is $10.26 apiece, suggesting there could be more upside left in the share yet.

Investors will be hoping Lynas can repeat its performance in FY22 when it soared by 53%. This was particularly impressive given the ASX 200 itself fell some 10% during the period.

In the last 12 months, the Lynas share price has gained 38%.

The post What’s the outlook for the Lynas share price in FY23? appeared first on The Motley Fool Australia.

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Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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