Molycorp Inc.'s shares jumped Friday after the rare earth product company reported a better-than-expected first quarter that beat Wall Street forecasts.
THE SPARK: Molycorp on Thursday posted a loss of $47.2 million, or 33 cents per share, for the quarter that ended March 31. That's compared with a loss of $3.5 million, or 7 cents per share, for the prior year. Excluding one-time items, the company posted an adjusted loss of 15 cents per share.
Revenue rose 9 percent to $146.4 million.
Analysts polled by FactSet expected a loss of 31 cents per share on revenue of $135.6 million.
THE BIG PICTURE: The company, based in Greenwood Village, Colo., mines and processes rare earth products. Molycorp expects its financial performance in the first half of the year to be weaker than in the second half. Rare-earth sales typically slow in the first quarter, and the company's Mountain Pass facility probably will not be at full commercial production until the middle of the year. Molycorp also sees signs that demand will return to more normal levels as the year progresses.
THE ANALYSIS: Stifel analyst Paul S. Forward said that while the loss for the quarter was less than expected, he is lowering his 2013 earnings forecast to below market expectations on assumed sales volume decline in part of its business and more conservative pricing. Forward kept a "Hold" rating on the shares.
SHARE ACTION: Up $1.09, or 19.5 percent, to $6.68 in afternoon trading. The stock has traded in a 52-week range of $4.70 to $26.10.