Why the American Rare Earths (ASX:ARR) share price soared 19% today

The rare earths miner has some key updates to share with the market

| More on:
Man in overalls at mine cheering

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The American Rare Earths Ltd (ASX: ARR) share price has jumped into the green today.

At one stage this morning, the shares were skyrocketing by 19%. However, at the time of writing they have partially retreated and are swapping hands for 9.4 cents, still a gain of 11.9% on yesterday's closing price.

The move comes as the company released drilling estimates from its La Paz site earlier today.

Quick refresher on American Rare Earths

American Rare Earths is in the mining and exploration business.

Its geographical footprint lies in the Murray Basin and at Broken Hill, alongside its interests at the La Paz Rare Earth project and the Thackaringa Cobalt project.

American Rare Earths has a market capitalisation of $28.9 million at the time of writing.

What did the company release?

The company outlined drilling at La Paz delivered an "indicated resource estimate increase" of 117%.

Indicated resource estimates exhibited a growth from 16.2 million tonnes (MT) to 35.2MT, whilst JORC compliant resource tonnage increased by 33.1%.

Results of such magnitude demonstrates the La Paz site could be "one of the largest rare earths projects in North America", according to the company.

Assay results obtained from this site also show it is an "environmentally stable resource" compared to "most other projects on the market".

Additionally, American believes the announcement "supports the development of US domestic rare earths supply chain".

Moreover, it also "highlights the strategic value of (the) assets" to the US Government.

Investors have favoured the announcement, pushing the American Rare Earths share price 19% into the green at one point today.

American Rare Earths shares are now exchanging hands at 9.4 cents, well below their 52-week high of 23.5 cents.

American Rare Earths share price snapshot

The American Rare Earths share price has posted a year-to-date return of 9%. It has also gained 317% in the last 12 months.

This has outpaced the S&P / ASX 200 Index (ASX: XJO)'s return of approximately 26% over the past year.

The author Zach Bristow has no positions in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

A golfer celebrates a good shot at the tee, indicating success.
Share Market News

Here are the top 10 ASX 200 shares today

ASX investors finally enjoyed a win this Thursday...

Read more »

a man sits back from his laptop computer with both hands behind his head feeling happy to see the Brambles share price moving significantly higher today
Industrials Shares

Up 39% in a year, is there more growth to come for this ASX 200 share?

IML Equity Analyst Josh Freiman shares his views on a major ASX 200 industrial stock.

Read more »

Man looking at his grocery receipt, symbolising inflation.
Share Market News

What the latest US inflation print means for ASX 200 investors

The ASX 200 is likely to benefit if the US Fed cuts interest rates again in December. But will it?

Read more »

guy helping girl invest in shares and dividends
Opinions

5 ways for investors buying ASX shares to stay focused during economic uncertainty

AMP Chief Economist, Dr Shane Oliver, offers advice on how to handle the Trump factor.

Read more »

A worried man holds his head and look at his computer.
Share Fallers

Why Graincorp, Light & Wonder, Orica, and Wildcat shares are falling today

These shares are having a tough time on Thursday. But why?

Read more »

A young women pumps her fists in excitement after seeing some good news on her laptop.
Share Gainers

Why Catapult, Flight Centre, Nufarm, and Xero shares are storming higher today

These shares are having a strong session on Thursday. But why? Let's find out.

Read more »

A male investor sits at his desk looking at his laptop screen holding his hand to his chin pondering whether to buy Macquarie shares
Opinions

1 ASX growth stock down 30% I'd buy right now

This international business is growing core earnings at a strong rate.

Read more »

Concept image of a man in a suit with his chest on fire.
Record Highs

How long can the CBA share price keep this up?

Australia's biggest bank is running hot. Does it make any sense?

Read more »