The Lynas Rare Earths Ltd (ASX: LYC) share price gained 3.72% in today's trading session.
Shares of the rare earths producer ended the day at $8.64 each.
Lynas's share price could have received a boost by movements of the materials sector, which was the best-performing sector on the ASX on Tuesday.
The S&P/ASX 200 Materials Index (ASX: XMJ) finished 2.64% higher. For comparison, the S&P/ASX 200 Index (ASX: XJO) closed up 1.65%.
Meanwhile, a few of Lynas's peers also received a boost this afternoon. Here's a look at how these companies performed:
- BlueScope Steel Limited (ASX: BSL) up 2.73%
- Incitec Pivot Ltd (ASX: IPL) up 2.4%
- OZ Minerals Limited (ASX: OZL) up 0.58%
So while Lynas's share price movement could arguably be chalked up to movements by the broader market, there is also some evidence to suggest that the company could have as much as a 15% upside in the future.
This is according to a broker note published by UBS this afternoon. So let's cover what the broker said as well as some other expert commentary the company has received in the recent past.
Image source: Getty Images
Experts think Lynas shares could be on the rise
A UBS broker gave Lynas shares a price target of $9.95 as well as a buy rating on Tuesday, thus warranting the 15% potential upside.
One expert, BW Equities salesperson Tim Bleakley, agrees with the broker that Lynas could be ripe for the picking.
As the Fool reported earlier today, Bleakley praised Lynas's outlook, FY22 result, and crucially the fact that it's one of the few rare earth producers outside of China.
As an aside from Bleakley's comments, China's mounting aggression towards Taiwan could make rare earth producers outside of China such as Lynas and Arafura Resources Limited (ASX: ARU) much more valuable to the world economy as geopolitical tensions escalate.
This is according to comments contained in Arafura's most recent quarterly activities report in which its geographics were stated as being one of its key advantages.
On a different note, Lynas expects strong demand for its neodymium and praseodymium output in the future. This is despite its quarterly sales revenue falling 44% in its quarterly activities report for Q1 FY23.
Lynas share price snapshot
The Lynas share price is down 16% year to date but up 14% over the past year.
Meanwhile, the ASX 200 is down around 7% and 6% over the same periods.
The company's market capitalisation is around $7.53 billion.
