Gina Rinehart just boosted her holding of this beaten-up ASX 200 mining stock!

This stock is attracting Australia's richest person.

| More on:
A miner holding a hard hat stands in the foreground of an open cut mine

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

Australia's wealthiest person, Gina Rinehart, has just made her latest bet in the mining sector.

Rinehart's riches came from mining, and her main entity, Hancock Prospecting, has been investing in a company attracting plenty of attention this week: S&P/ASX 200 Index (ASX: XJO) mining stock Lynas Rare Earths Ltd (ASX: LYC).

Lynas mines various rare earths, including neodymium and praseodymium (NdPr). It's the world's only major producer of separated rare earths outside of China. Rare earths are used in many high-tech and future-facing applications, including electronics, wind turbines, and hybrid and electric vehicles.

Rinehart increases stake

Before this week, Hancock Prospecting owned 54.4 million Lynas shares, representing 5.8% of the ASX 200 mining stock.

Lynas reported in an ASX announcement today that Hancock Prospecting had increased its stake by 12.34 million Lynas shares since the last notice in April 2024. This investment takes its stake to 7.14% of the rare earth business.

The miner advised that Hancock Prospecting had made numerous investments over the last three months, with this week's two transactions being the biggest. Yesterday, it bought 1.18 million Lynas shares for $5.97 per share, and on Tuesday, it bought 1.32 million Lynas shares for $5.99 per share.

It appears Rinehart and her business associates are excited about the rare earth miner and want to keep boosting their stake because of its strategic importance.

Recent update

Lynas recently gave the market its operational update for the three months to 30 June 2024, which wasn't the most inspiring set of figures.  

The miner reported gross sales revenue dropped 13.3% to $136.6 million, while sales receipts dropped 37.8% to $117.5 million.

Lynas reported it produced 2,188 rare earth oxide (ROE) tonnes, down year over year from 4,475 tonnes in the fourth quarter of FY23. NdPr production was 1,504 ROE tonnes, down from 1,864 tonnes in the prior corresponding period.

The ASX 200 mining stock explained the lower production was due to essential maintenance conducted at Lynas Malaysia during the quarter.

Lynas reported there was a "slight improvement" in China's domestic end-product demand, though market prices "remained low". However, the average selling price "improved through the quarter" as it "carefully managed the timing of sales, especially for heavy rare earth which were quite volatile throughout the quarter."

Lynas share price snapshot

As the chart below shows, the Lynas share price is down around 15% from the start of the year and has dropped 14.4% since 21 May 2024. Shares in the miner are trading 0.25% higher today at $6.08.

Created with Highcharts 11.4.3Lynas Rare Earths Ltd PriceZoom1M3M6MYTD1Y5Y10YALL31 Dec 202325 Jul 2024Zoom ▾Jan '24Feb '24Mar '24Apr '24May '24Jun '24Jul '24Jan '24Jan '24Mar '24Mar '24May '24May '24Jul '24Jul '24www.fool.com.au

Motley Fool contributor Tristan Harrison has no position 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 Scott Phillips.

More on Resources Shares

a miner holds his thumb up as he holds a device in his other hand.
Resources Shares

3 reasons why the BHP share price could still be a buy

There are a few reasons why this mining giant could be appealing.

Read more »

Miner standing in front of trucks and smiling, symbolising a rising share price.
Resources Shares

The pros and cons of buying Fortescue shares in June

Let’s dig into whether it’s a good time to invest in this mining giant.

Read more »

Image from either construction, mining or the oil industry of a friendly worker.
Resources Shares

Why did the Mineral Resources share price rip 15% higher today?

The iron ore and lithium giant was the fastest riser of the ASX 200 on Thursday.

Read more »

A man wearing a hard hat and high visibility vest looks out over a vast plain where heavy mining equipment can be seen in the background.
Resources Shares

2030 forecast: As Australia's iron ore export earnings decline, copper will rise. What does this mean for BHP shares?

BHP is expanding its iron ore and copper production.

Read more »

An engineer takes a break on a staircase and looks out over a huge open pit coal mine as the sun rises in the background.
Resources Shares

4 reasons to buy BHP shares today

A leading expert outlines four key reasons BHP shares are a buy.

Read more »

Businessman walks through exit door signalling resignation
Resources Shares

Pilbara Minerals share price drops as CFO announces resignation

It’s been a challenging few years for outgoing Pilbara Minerals CFO Luke Bortoli.

Read more »

Miner looking at a tablet.
Resources Shares

What happened with the BHP share price in May?

Did you buy BHP shares in May? Here’s how much the ASX 200 miner returned.

Read more »

Two men in hard hats and high visibility jackets look together at a laptop screen at a mine site.
Resources Shares

Should I buy Fortescue shares today?

A leading investing expert offers his verdict on the outlook for Fortescue shares.

Read more »