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Highlights
Shares of rare earths company, Lynas, closed over 2% today.
The stock has gained over 70% in the last 12 months.
Increased demand for rare earths supported Lynas’ business during FY22 half-year with a significant increase in its yearly revenue.
Shares of ASX-listed rare earths company, Lynas Rare Earths Limited (ASX:LYC), closed 2.224% higher at AU$10.570 per share today.
Although there’s no specific announcement by the company, investors have been keeping the stock on their radar.
Lynas has been one of the strongest performers over the last 12 months and has gained around 8% since its FY22 half-yearly results.
Moreover, the material sector closed at 0.084% higher at 7,412.40 points. It is the strongest-performing sector on the ASX as of now, with shares like BHP Group (ASX:BHP), Rio Tinto (ASX:RIO), Fortescue Metals (ASX:FMG) being some of the strongest gainers.
Related read - Here’s why Lynas Rare Earths (ASX:LYC) shares are gaining on ASX
What’s driving LYC’s share price?
Image source: © Wutzkoh | Megapixl.com
While the company has no news that could explain the price surge, LYC’s share price has gained 8% since its FY22 half-yearly results. Given the strong sector performance, this can be a possible reason behind the price surge.
As per the report, the company witnessed a significant year-on-year increase in its profitability and revenue.
H1FY22 Key highlights –
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Lynas booked a record net profit after tax (NPAT) of AU$156.9 million while revenue surged by 55% to AU$314.8 million.
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Meanwhile, the cost of sales declined by 7% to AU$140.3 million.
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On the other hand, EBITDA increased to AU$189. 8 million from AU$80.6 million in 1H21.
Lynas has enjoyed favourable market dynamics as the demand for rare earths continued to increase. Moreover, governments around the world are targeting the electrification of new cars. As a result, EV sales more than doubled to 6.6 million in CY21.
Related read - How these three ASX blue chips have been doing in 2022 so far?
Lynas share price movement
Image Source © 2022 Kalkine Media ®
The stock has gained over 72% in the last year. However, it has fallen 6% on YTD this year. Meanwhile, there is some improvement in the previous three months, with the stock gaining 2%.
What next?
With robust market conditions and demand growth, Lynas is confident regarding its upcoming business strategy. Moreover, Lynas is investing in several areas in line with its 2025 strategy, including a rare earth processing facility in Kalgoorlie.
