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Chicago, IL – March 25, 2022 – Today, Zacks Investment Ideas feature highlights MP Materials Corp. (MP - Free Report) and Alpha Metallurgical Resources, Inc. (AMR - Free Report) .
Dizzy from This Whipsaw Market? Thrive with These Leading "Strong Buys"
Corrections and bear markets bring about the full array of investor emotions – from fear and panic to relief and hope. When markets are volatile and unpredictable, remaining poised and steadfast in our decision-making is crucial to our performance.
History serves as an unbiased guide for what to expect in the future. While no two time periods are exactly alike, there are often similarities that can help shape our investment outlook and portfolio allocations. This speaks to the old market adage – history rarely repeats itself but often rhymes.
This year's combination of midterm political gridlock and a significant geopolitical event has rattled markets through the first few months. But stocks have been in a similar position before and over time have proven resilient. That's why having a plan in place and being ready for these types of environments is key.
According to LPL Research, we've had 32 other corrections dating back to 1980 (including this most recent one). Looking one year out from the date of a correction, the S&P 500 is up an average of 24.8% from the lows of the move. Regardless of the times, there are always concerns that market participants must address and factor into their process.
This year is no different - whether it be COVID-19 concerns, Putin's horrific invasion, or accelerating inflation, there is no shortage of headlines instilling investors with fear. When a potential war is involved, the media response grows even more frightening which is why it's so important that we keep our cool during these times. My advice for investors: steer clear of the drama.
History has shown that remaining patient and adjusting to the volatility can pay huge dividends in the future. More ominous than the correction itself, missing out on the subsequent rally is the real danger. But we can do better than just remaining patient. We can adjust.
With volatility comes opportunity, and that's exactly where we find ourselves this year. The Zacks – Mining – Miscellaneous industry group has outperformed this year and is a great example of adjusting to the current market environment. This industry has been witnessing positive earnings estimate revision activity – a powerful force that propels stocks upward. The group is currently ranked in the top 27% of approximately 250 Zacks Ranked Industries.
Quantitative research studies have shown that about half of a stock's future price appreciation is due to its industry group. In fact, the top 50% of all Zacks Ranked Industries outperforms the bottom 50% by a factor of more than 2 to 1.
By adjusting to the times and focusing on stocks within the top industry groups, we can dramatically improve our investing success.
Let's take a closer look at two Zacks Rank #1 (Strong Buy) stocks within this leading industry group.
MP Materials Corp.
MP Materials is a producer of rare earth materials. MP owns and operates rare earth mining and processing facilities, highlighted by the mineral rights to the Mountain Pass mine in California. The company also owns the intellectual property rights related to the processing and development of these minerals. MP Materials was founded in 2017 and is based in Las Vegas, NV.
MP exceeded earnings estimates during each quarter over the past year, boasting a +33.56% average earnings surprise. The company most recently reported Q4 EPS of $0.31, a +14.81% surprise over the $0.27 consensus. The stock has advanced over 68% in the past year and is up 24% this year alone.
Analysts covering MP have increased their current-quarter EPS estimates by 70% in just the past 30 days. The Q1 Zacks Consensus Estimate now stands at $0.34, translating to potential growth of 161.54% over the same quarter last year. MP is set to release these results on May 5th.
Alpha Metallurgical Resources, Inc.
Alpha Metallurgical Resources is a coal producer, operating twenty active mines and eight coal preparation facilities. The mining company processes and sells met and thermal coal primarily in Virginia and West Virginia. AMR supplies metallurgical products to the steel industry. Alpha Metallurgical Resources was incorporated in 2016 is based in Bristol, TN.
AMR most recently reported Q4 EPS of $13.3, an +11.36% beat over the $11.94 consensus estimate. The stock is up over 950% in the past year and has surged over 110% this year alone.
Despite the impressive performance, AMR is vastly undervalued at a 1.89 forward P/E relative to its industry (9.95). The mining company has been on the receiving end of positive earnings estimate revisions. Analysts have upped their full-year EPS estimates by 60.15% in the past 60 days.
The 2022 Zacks Consensus EPS Estimate is now $69.97, reflecting a 357.32% growth rate relative to 2021. AMR is scheduled for its next quarterly report on May 9th.
Why Haven't You Looked at Zacks' Top Stocks?
Our 5 best-performing strategies have blown away the S&P's impressive +28.8% gain in 2021. Amazingly, they soared +40.3%, +48.2%, +67.6%, +94.4%, and +95.3%. Today you can access their live picks without cost or obligation.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Zacks Investment Ideas feature highlights: MP Materials and Alpha Metallurgical Resources
For Immediate Release
Chicago, IL – March 25, 2022 – Today, Zacks Investment Ideas feature highlights MP Materials Corp. (MP - Free Report) and Alpha Metallurgical Resources, Inc. (AMR - Free Report) .
Dizzy from This Whipsaw Market? Thrive with These Leading "Strong Buys"
Corrections and bear markets bring about the full array of investor emotions – from fear and panic to relief and hope. When markets are volatile and unpredictable, remaining poised and steadfast in our decision-making is crucial to our performance.
History serves as an unbiased guide for what to expect in the future. While no two time periods are exactly alike, there are often similarities that can help shape our investment outlook and portfolio allocations. This speaks to the old market adage – history rarely repeats itself but often rhymes.
This year's combination of midterm political gridlock and a significant geopolitical event has rattled markets through the first few months. But stocks have been in a similar position before and over time have proven resilient. That's why having a plan in place and being ready for these types of environments is key.
According to LPL Research, we've had 32 other corrections dating back to 1980 (including this most recent one). Looking one year out from the date of a correction, the S&P 500 is up an average of 24.8% from the lows of the move. Regardless of the times, there are always concerns that market participants must address and factor into their process.
This year is no different - whether it be COVID-19 concerns, Putin's horrific invasion, or accelerating inflation, there is no shortage of headlines instilling investors with fear. When a potential war is involved, the media response grows even more frightening which is why it's so important that we keep our cool during these times. My advice for investors: steer clear of the drama.
History has shown that remaining patient and adjusting to the volatility can pay huge dividends in the future. More ominous than the correction itself, missing out on the subsequent rally is the real danger. But we can do better than just remaining patient. We can adjust.
With volatility comes opportunity, and that's exactly where we find ourselves this year. The Zacks – Mining – Miscellaneous industry group has outperformed this year and is a great example of adjusting to the current market environment. This industry has been witnessing positive earnings estimate revision activity – a powerful force that propels stocks upward. The group is currently ranked in the top 27% of approximately 250 Zacks Ranked Industries.
Quantitative research studies have shown that about half of a stock's future price appreciation is due to its industry group. In fact, the top 50% of all Zacks Ranked Industries outperforms the bottom 50% by a factor of more than 2 to 1.
By adjusting to the times and focusing on stocks within the top industry groups, we can dramatically improve our investing success.
Let's take a closer look at two Zacks Rank #1 (Strong Buy) stocks within this leading industry group.
MP Materials Corp.
MP Materials is a producer of rare earth materials. MP owns and operates rare earth mining and processing facilities, highlighted by the mineral rights to the Mountain Pass mine in California. The company also owns the intellectual property rights related to the processing and development of these minerals. MP Materials was founded in 2017 and is based in Las Vegas, NV.
MP exceeded earnings estimates during each quarter over the past year, boasting a +33.56% average earnings surprise. The company most recently reported Q4 EPS of $0.31, a +14.81% surprise over the $0.27 consensus. The stock has advanced over 68% in the past year and is up 24% this year alone.
Analysts covering MP have increased their current-quarter EPS estimates by 70% in just the past 30 days. The Q1 Zacks Consensus Estimate now stands at $0.34, translating to potential growth of 161.54% over the same quarter last year. MP is set to release these results on May 5th.
Alpha Metallurgical Resources, Inc.
Alpha Metallurgical Resources is a coal producer, operating twenty active mines and eight coal preparation facilities. The mining company processes and sells met and thermal coal primarily in Virginia and West Virginia. AMR supplies metallurgical products to the steel industry. Alpha Metallurgical Resources was incorporated in 2016 is based in Bristol, TN.
AMR most recently reported Q4 EPS of $13.3, an +11.36% beat over the $11.94 consensus estimate. The stock is up over 950% in the past year and has surged over 110% this year alone.
Despite the impressive performance, AMR is vastly undervalued at a 1.89 forward P/E relative to its industry (9.95). The mining company has been on the receiving end of positive earnings estimate revisions. Analysts have upped their full-year EPS estimates by 60.15% in the past 60 days.
The 2022 Zacks Consensus EPS Estimate is now $69.97, reflecting a 357.32% growth rate relative to 2021. AMR is scheduled for its next quarterly report on May 9th.
Why Haven't You Looked at Zacks' Top Stocks?
Our 5 best-performing strategies have blown away the S&P's impressive +28.8% gain in 2021. Amazingly, they soared +40.3%, +48.2%, +67.6%, +94.4%, and +95.3%. Today you can access their live picks without cost or obligation.
See Stocks Free >>
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.