Lynas Rare Earths Limited (ASX: LYC), the largest producer of separated rare earths outside China, is in the spotlight again on 9 December 2025 – but this time for a sharp pullback after a huge year-long rally.
By lunchtime on Tuesday, Lynas shares were trading around A$12.93, down about 5% from Monday’s close of A$13.61. That leaves the stock roughly 40% below its October 52‑week high of A$21.64, but still about 110% above its January low near A$6.16. [1]
In other words: the 2025 “rare earths trade” is very much alive, but volatility is back.
Share price snapshot: big 2025 gains, sharp early‑December correction
Market data from Intelligent Investor show Lynas trading at A$12.93 at 12:36 pm on 9 December, within a day range of A$12.91–A$13.44 and on a market cap of roughly A$13–14 billion. [2]
Over the past 12 months:
- 52‑week high: A$21.64 on 15 October 2025
- 52‑week low: A$6.16 on 30 January 2025
- Current price: about 40% below that October peak, but ~110% above the January low. [3]
TipRanks puts year‑to‑date performance near 120%, while Reuters recently noted a gain of about 115% even after the recent slide. [4]
Short‑term technical models are less cheerful. StockInvest.us flags Lynas as a short‑term sell candidate, noting a 3.75% fall on 8 December (from A$14.14 to A$13.61), a 9.5% decline over the last 10 trading days, and an expected ~11% drift lower over the next three months within a wide, falling trend. [5]
Algorithmic site WalletInvestor, however, is mildly bullish, projecting the share price to rise from about A$12.98 today to A$15.12 in one year and A$18.93 by late 2030 – a modeled five‑year gain of around 46% purely on technical patterns. [6]
Fresh catalysts: ASX 50 promotion, director share sale and Kalgoorlie power shocks
1. ASX 50 promotion: a liquidity upgrade, not an automatic win
One of the biggest headlines for Lynas this month is its promotion into the S&P/ASX 50 Index.
S&P Dow Jones Indices confirmed on 5 December that Lynas will join the ASX 50 at the open on 22 December 2025 as part of the quarterly rebalance. [7]
Analysis from financial outlets such as Shareholder Value’s ad‑hoc note highlights a few key implications: [8]
- Index‑tracking funds and ASX 50 ETFs will need to buy Lynas shares, boosting baseline demand and liquidity.
- The inclusion reflects more than a doubling of the share price in 2025 and Lynas’ rising market cap.
- But it comes just as some analysts are questioning whether the stock has run ahead of fundamentals.
Since S&P’s rebalance announcement on 5 December, the share price has slid from about A$14.14 to the low‑A$13s and now high‑A$12s, a classic case of “buy the rumour, sell the news.” [9]
2. Director share sale – but for tax, not a change of heart
Another headline this week is a director share sale.
A regulatory filing shows that the Morgan Lacaze Family Trust, associated with CEO Amanda Lacaze, sold 329,688 Lynas shares to meet tax liabilities, reducing her indirect holding. [10]
TipRanks’ write‑up stresses:
- The sale was explicitly for taxation purposes, rather than a strategic disposal.
- Lynas’ year‑to‑date price performance stands near +120%.
- The most recent broker rating referenced in that note is a Buy with a A$17 price target. [11]
Investors typically watch insider selling closely, but tax‑driven transactions like this are generally viewed as less worrying than discretionary sales.
3. Kalgoorlie power disruptions: execution risk on display
More fundamentally, Lynas has warned of a production shortfall at its new Kalgoorlie processing plant in Western Australia after significant power disruptions in November. [12]
Key points from the company’s late‑November update and Reuters coverage: [13]
- Power outages have reduced output of Mixed Rare Earth Carbonate (MREC), the intermediate product shipped to Malaysia for further processing.
- The shortfall could be equivalent to around one month of production for the current quarter.
- Lynas is evaluating off‑grid power solutions and working with the WA government and Western Power to stabilise supply.
- Management believes lost output can be recovered over the financial year, if mitigation is successful.
For a growth stock priced for smooth execution, these kinds of operational hiccups matter – especially when they coincide with rich valuation debates.
Business performance: from profit slump to revenue rebound
2025 has been a tale of two halves for Lynas’ earnings profile.
Earlier in the year, the company reported that first‑half profit had slumped about 85% year on year, largely due to weaker rare earth prices and higher costs. [14]
More recent results have been much stronger:
- For the September 2025 quarter, Lynas posted sales revenue of around A$200.2 million, up sharply versus prior quarters, though slightly below analyst expectations. [15]
- A ShareCafe breakdown shows ready‑for‑sale REO production of roughly 3,993 tonnes, including 2,003 tonnes of neodymium‑praseodymium (NdPr) – the key magnet material – and initial shipments of heavy rare earth oxides dysprosium (Dy) and terbium (Tb) to customers. [16]
- The Lynas 2025 expansion project remains on track, with ore processing underway at the Mt Weld mine and the solar component of a hybrid power station now operating. [17]
Consensus numbers compiled by Intelligent Investor imply that net profit after tax (NPAT): [18]
- 2025 (actual): about A$8.9 million, after the profit slump;
- 2026 (forecast): around A$31 million;
- 2027 (forecast): about A$74 million.
On these forecasts, Lynas screens as extremely expensive on trailing earnings (P/E ~760x), but drops to a still‑elevated ~46x 2026 earnings and ~19x 2027 earnings if those estimates are met. [19]
Analyst datasets aggregated by StocksGuide show a similar picture at the revenue and margin level: [20]
- 2025 revenue: about A$557 million
- 2026 revenue: consensus around A$1.1 billion (up ~105%)
- 2028 revenue: approaching A$2.0 billion
- 2026 EBITDA: average estimate ~A$505 million, implying a 44% EBITDA margin vs under 10% on trailing numbers.
That is a very aggressive earnings ramp – and it’s exactly what the share price is now being asked to discount.
Strategic projects: heavy rare earths, Malaysian magnets and the US Noveon tie‑up
Lynas’ valuation only makes sense in the context of a very busy growth pipeline.
Heavy rare earth separation in Malaysia
In late October, Lynas announced plans for a new heavy rare earth (HRE) separation facility in Malaysia, with an estimated capital cost of about A$180 million and the capacity to process up to 5,000 tonnes of heavy rare earth feedstock a year. [21]
Feedstock will come primarily from Mt Weld and potentially other sources. The goal is to produce ex‑China supplies of elements such as dysprosium and terbium, which command premium prices and are crucial for high‑temperature permanent magnets in EV motors and defence systems. [22]
“Super magnet” plant in Malaysia with JS Link
Parallel to that, Malaysia has announced a 600 million ringgit (≈US$142 million) “super magnet” plant in Pahang, built by Lynas and South Korea’s JS Link.
State media and Reuters report that the facility will be capable of producing about 3,000 tonnes per year of neodymium‑iron‑boron (NdFeB) magnets, located near Lynas’ existing advanced materials plant in Kuantan. [23]
Malaysia’s prime minister has emphasised that land has been secured and investment committed, signalling the project has moved beyond the “MOU” stage. [24]
For Lynas, this is a significant step downstream, turning its oxides into a higher‑margin, stickier magnet business in partnership with an experienced producer rather than going it alone.
US magnet partnership with Noveon
On the other side of the Pacific, Lynas has signed a strategic partnership with Texas‑based Noveon Magnetics, one of the few sintered rare earth magnet manufacturers in the US. [25]
Key features of the Lynas–Noveon deal:
- It is a non‑binding MoU that lays out a framework from Lynas supplying light and heavy rare earth oxides through to metal, alloy and finished magnet production in the US. [26]
- The alliance specifically targets US defence, automotive and industrial customers, aiming to create a traceable, domestic mine‑to‑magnet supply chain in line with US national security goals. [27]
Together with the Malaysian magnet project, this positions Lynas as not just a miner and oxide producer, but as a key upstream partner in Western magnet manufacturing.
Geopolitical backdrop: China’s export clampdown and Western policy support
None of this is happening in a vacuum.
In April 2025, China tightened export controls on several heavy rare earths and magnets. In October 2025, Beijing went further, introducing new export rules targeting technologies for rare earth mining, separation, magnet production and recycling – with defence‑related exports effectively banned and advanced semiconductor uses subject to case‑by‑case approval. [28]
Analysts report that these steps have: [29]
- Driven sharp price spikes for key elements such as dysprosium in international markets.
- Triggered production disruptions for some automakers and electronics manufacturers.
- Accelerated a global scramble for non‑Chinese supply, with companies like Lynas, MP Materials and Arafura Rare Earths now central to Western industrial policy.
At the same time, Australia has been considering a price floor mechanism for critical minerals, including rare earths, as part of a strategic reserve plan – a move first flagged in mid‑2025 government statements and widely reported in industry press. TechStock²
Put simply, the rare earth market is now a policy battleground. For Lynas, that’s both an opportunity (structural demand, policy support) and a risk (political and regulatory volatility in places like Malaysia and the US).
What analysts and models are saying about Lynas now
Given the mix of strategic importance, project pipeline and execution risk, it’s no shock that analyst views are all over the map.
Fundamental and broker views
Recent Reuters coverage of new Morningstar research noted that: [30]
- Morningstar has initiated coverage with a fair value estimate of A$7 per share, far below current prices.
- It still models a 65% compound annual growth rate in EBITDA over five years and NdPr volumes roughly doubling to ~12,500 tonnes by FY2030.
- Nevertheless, Morningstar thinks the stock price implies unrealistically high long‑term rare earth prices and labels the shares “overpriced”.
In the same Reuters note, LSEG data showed that 7 of 14 analysts rate Lynas a buy or better, 4 rate it hold and 3 sell or lower, with a mean price target around A$16.31 – implying solid upside from current levels, but not a repeat of 2025’s fireworks. [31]
Other datasets paint a similar yet nuanced picture:
- TipRanks cites an average target in the mid‑A$15s with high estimates in the A$19s and lows around A$9–10. [32]
- StocksGuide aggregates 18 analysts, with 10 Buys, 5 Holds and 3 Sells and an average 2026 upside potential of ~13%, plus consensus revenue of A$1.1 billion in 2026 rising towards A$2.0 billion by 2028. [33]
- Simply Wall St, using S&P Global data, highlights that analyst models imply triple‑digit annualised revenue growth (~100%+) through 2026, compared with roughly 5% for the wider materials sector. [34]
Layered on top, Rare Earth Exchanges notes that both UBS and Goldman Sachs upgraded Lynas to strong‑buy‑type ratings in late November, citing its unique position as a non‑Chinese NdPr and heavy rare earth supplier. [35]
Yet valuation is awkward: as we saw earlier, consensus implies P/E ratios collapsing from >700x trailing to ~46x (2026) and ~19x (2027) – still rich for a cyclical miner, and highly dependent on both project delivery and commodity prices. [36]
Quantitative and technical models
On the purely quantitative side, the signals are mixed:
- StockInvest.us expects a 10–11% slide over the next three months, with the share trading near the bottom of a wide, falling short‑term trend. [37]
- WalletInvestor’s long‑term technical model sees Lynas as a “good long‑term investment”, with a projected one‑year price of ~A$15.12 and a five‑year target around A$18.93. [38]
These models don’t “know” about Kalgoorlie power issues, Malaysia politics or US contracts – they simply extrapolate historical price action. They’re useful as sentiment thermometers, not crystal balls.
Key risks and upside drivers for 2026
Pulling the threads together, a few issues are likely to dominate Lynas’ share‑price story over the next 12–18 months:
Upside drivers
- Kalgoorlie stabilisation: Getting reliable power in place and proving consistent MREC output would help restore confidence after November’s disruptions. [39]
- Malaysia heavy rare earth project: Successful execution of the new HRE separation plant – at design capacity and budget – could unlock high‑margin Dy/Tb revenue in a structurally tight market. [40]
- Magnet partnerships bearing fruit: Turning the JS Link and Noveon deals into real, recurring magnet sales would shift Lynas further downstream and potentially smooth earnings. [41]
- Policy tailwinds: Any concrete Australian price‑floor mechanism, US or EU funding packages, or further diversification away from Chinese supply could support both volumes and pricing. [42]
Downside risks
- Operational hiccups: Extended or repeated power problems at Kalgoorlie or delays at Malaysian expansion projects could undermine the bullish growth narrative. [43]
- Commodity price weakness: If NdPr and heavy rare earth prices fall back as new capacity comes online globally, the richly valued earnings forecasts would be hard to achieve. TechStock²+2FinancialContent+2
- Regulatory and political risk in Malaysia: Lynas’ core processing and future HRE facilities are in a jurisdiction that has periodically debated rare earth processing rules; any renewed licensing or environmental disputes would be a serious overhang. [44]
- Competition and Chinese strategy: From a potential China–Malaysia refinery project to aggressive Chinese price tactics, Lynas operates in a market where policy decisions in Beijing can radically reshape economics. [45]
Bottom line: a strategically vital, high‑beta rare earths play
As of 9 December 2025, Lynas Rare Earths is:
- A core ex‑China supplier of both light and heavy rare earth oxides, with growing downstream magnet exposure. [46]
- In the midst of a major capex and expansion cycle, spanning Kalgoorlie, Malaysian heavy rare earths and magnet plants, plus the US Noveon partnership. [47]
- Newly promoted to the ASX 50, which should deepen liquidity and indexing demand but does nothing to reduce execution or commodity risk. [48]
The stock has already delivered triple‑digit percentage gains in 2025, yet now trades roughly 40% below its October peak as investors digest Morningstar’s “overpriced” verdict, operational setbacks and the sheer scale of the growth pencilled in for 2026–2028. [49]
For investors, Lynas is best thought of as a high‑beta way to express a view on the rare earths arms race: if non‑Chinese supply chains, EVs, wind and defence demand all develop as hoped – and Lynas executes smoothly – the current consolidation could prove to be a pause in a longer uptrend. If policy or prices move the other way, the same leverage that juiced 2025’s rally could work in reverse.
References
1. www.intelligentinvestor.com.au, 2. www.intelligentinvestor.com.au, 3. www.intelligentinvestor.com.au, 4. www.tipranks.com, 5. stockinvest.us, 6. walletinvestor.com, 7. www.intelligentinvestor.com.au, 8. www.ad-hoc-news.de, 9. www.intelligentinvestor.com.au, 10. www.tipranks.com, 11. www.tipranks.com, 12. www.reuters.com, 13. www.reuters.com, 14. www.reuters.com, 15. www.reuters.com, 16. www.sharecafe.com.au, 17. www.sharecafe.com.au, 18. www.intelligentinvestor.com.au, 19. www.intelligentinvestor.com.au, 20. stocksguide.com, 21. www.reuters.com, 22. www.reuters.com, 23. www.reuters.com, 24. www.straitstimes.com, 25. www.prnewswire.com, 26. www.prnewswire.com, 27. www.reuters.com, 28. markets.financialcontent.com, 29. markets.financialcontent.com, 30. www.tradingview.com, 31. www.tradingview.com, 32. www.tipranks.com, 33. stocksguide.com, 34. simplywall.st, 35. rareearthexchanges.com, 36. www.intelligentinvestor.com.au, 37. stockinvest.us, 38. walletinvestor.com, 39. www.reuters.com, 40. www.reuters.com, 41. www.reuters.com, 42. markets.financialcontent.com, 43. www.reuters.com, 44. www.reuters.com, 45. www.reuters.com, 46. www.intelligentinvestor.com.au, 47. www.sharecafe.com.au, 48. www.intelligentinvestor.com.au, 49. www.intelligentinvestor.com.au
