MP Materials (NYSE:MP) vs. American Lithium (NASDAQ:AMLI) Financial Review

MP Materials (NYSE:MP) and American Lithium (NASDAQ:AMLI) are both basic materials companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, institutional ownership, risk, dividends, earnings and profitability.

Volatility & Risk

MP Materials has a beta of 2.22, indicating that its stock price is 122% more volatile than the S&P 500. Comparatively, American Lithium has a beta of 1.52, indicating that its stock price is 52% more volatile than the S&P 500.

Insider and Institutional Ownership

52.6% 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 insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for MP Materials and American Lithium, as reported by MarketBeat.

	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 presently has a consensus target price of $20.50, indicating a potential upside of 47.48%. American Lithium has a consensus target price of $3.25, indicating a potential upside of 577.08%. Given American Lithium’s stronger consensus rating and higher probable upside, analysts plainly believe American Lithium is more favorable than MP Materials.

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%

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	$253.45 million	9.07	$24.31 million	($0.15)	-92.66
American Lithium	N/A	N/A	-$29.55 million	($0.14)	-3.43

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.

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.