Top 5 Small Company Stocks You Should Own Now

1. MP Materials Corp. (NYSE:MP)

Number of Hedge Fund Holders: 26

MP Materials Corp. (NYSE:MP) is a Las Vegas-based company that owns and operates rare earth mining and processing facilities. On August 4, the company posted a Q2 non-GAAP EPS of $0.43 and a revenue of $143.56 million, beating Wall Street estimates by $0.08 and $14.81 million, respectively. The revenue gained 96.4% on a year over year basis. The Q2 net income nearly tripled to $73.3 million from $27.2 million in the year-earlier quarter. The Q2 beat was supported by demand and prices rising for rare earth materials.

On August 5, Baird analyst Ben Kallo raised the price target on MP Materials Corp. (NYSE:MP) to $55 from $45 and kept an Outperform rating on the shares. The analyst said the company exceeded market consensus on Q2 results, and more importantly, reiterated the timeline for both its Stage 2 and Stage 3 expansions. Operationally, the company continues to execute well and production volumes were the highest in the mine’s long history. Cash flow was robust and paired with cash from operations, it will continue to drive growth and additional expansion this year.

According to Insider Monkey’s data, 26 hedge funds were long MP Materials Corp. (NYSE:MP) at the end of Q2 2022, compared to 25 funds in the preceding quarter. JHL Capital Group is the leading position holder in the company, with more than 38 million shares worth $1.2 billion. 

Here is what Bernzott Capital US Small Cap Value Fund has to say about MP Materials Corp. (NYSE:MP) in its Q1 2022 investor letter:

“MP Materials (NYSE:MP): This rare earth specialty materials company reported solid earnings driven by higher production and selling prices of neodymium-praseodymium (NdPr), a vital component for the development of magnets used in EV production, wind turbines, drones, robotics, and other industrial applications. Also contributing were offtake agreements with General Motors for magnets and expansion plans for domestic production of magnets making MP the only domestic producer. The balance sheet and cash flow generation remain strong, supportive of expansion plans in the current NdPr pricing environment.”

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