Today is shaping up negative for MP Materials Corp. (NYSE:MP) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Revenue and earnings per share (EPS) forecasts were both revised downwards, with analysts seeing grey clouds on the horizon.

After the downgrade, the consensus from MP Materials' eleven analysts is for revenues of US$168m in 2024, which would reflect a noticeable 3.2% decline in sales compared to the last year of performance. Per-share losses are expected to explode, reaching US$0.40 per share. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$190m and losses of US$0.26 per share in 2024. Ergo, there's been a clear change in sentiment, with the analysts administering a notable cut to this year's revenue estimates, while at the same time increasing their loss per share forecasts.

Check out our latest analysis for MP Materials

There was no major change to the consensus price target of US$21.88, signalling that the business is performing roughly in line with expectations, despite lower earnings per share forecasts.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the MP Materials' past performance and to peers in the same industry. We would also point out that the forecast 6.2% annualised revenue decline to the end of 2024 is better than the historical trend, which saw revenues shrink 10% annually over the past three years By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 5.2% per year. So it's pretty clear that, while it does have declining revenues, the analysts also expect MP Materials to suffer worse than the wider industry.

The Bottom Line

The most important thing to note from this downgrade is that the consensus increased its forecast losses this year, suggesting all may not be well at MP Materials. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that MP Materials' revenues are expected to grow slower than the wider market. The lack of change in the price target is puzzling in light of the downgrade but, with a serious decline expected this year, we wouldn't be surprised if investors were a bit wary of MP Materials.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple MP Materials analysts - going out to 2026, and you can see them free on our platform here.