The Lynas Rare Earths Ltd (ASX: LYC) share price is marching higher today to notch fresh 52-week highs.
Shares in the S&P/ASX 200 Index (ASX: XJO) rare earths miner closed yesterday at $7.57. In early afternoon trade on Thursday, shares touched a new 52-week high of $7.66 before retracing to their current price of $7.59 apiece, up 0.3%.
You'd have to go back to early March 2023 to find the ASX 200 mining stock trading at higher levels.
As you can see in the chart above, the Lynas share price has staged a remarkable comeback over the past two months, up more than 31% since the closing bell on 6 August.
This will come as welcome news to shareholders, though not to the growing cohort of short sellers betting against the stock. On Monday, Lynas was the sixth most shorted share on the ASX, with short interest ticking up to 11.1%.
But investors clearly see value in the company, which is the only significant producer of rare earths outside of China.
Image source: Getty Images
What's been lifting the Lynas share price?
Less than two months ago, the Lynas share price was sitting near two-year lows.
However, a number of brokers said that at those levels, the ASX rare earths miner was undervalued.
In early August, Bell Potter maintained its buy rating on the stock with an $8.50 price target. This was more than 40% above the share price at the time, with the broker optimistic about the outlook for the rare earths market.
And investors have continued to support the rare earths miner since Lynas released its full-year results (FY 2024) on 28 August.
That came despite a big retrace in some of the company's core metrics.
Revenue of $463.3 million, for instance, was down 41.6% from FY 2023, while net profit after tax (NPAT) of $84.5 million was down 72.8% year on year.
Profits and revenue came under pressure amid what were said to be "stubbornly low" rare earths market prices over the 12 months. And demand from China remained subdued.
With China recently upping its stimulus measures to boost its sluggish economic growth, the Lynas share price may be getting a lift from expectations of stronger demand in the year ahead.
Having received a variation for its Malaysian operating licence in FY 2024, Lynas is now also able to continue cracking and leaching in Malaysia.
And the miner's Kalgoorlie Rare Earths Processing Facility, in Western Australia, achieved first production over the year, which should bode well for FY 2025.
Addressing the ups and downs in rare earths prices during the results announcement, Lynas CEO Amanda Lacaze said, "Lynas has over a decade of experience as a supplier of separated rare earths and this means we are well prepared to weather market price volatility."
The Lynas share price is up 13% over 12 months.
