Boston, MA 06\/20\/2014 (wallstreetpr) \u2013 Molycorp Inc (NYSE:MCP)<\/b> surged highest in over a month\u2019s time after an insider sold shares and the company\u2019s Chief Executive Officer proposed increasing equity as a solution to manage declining cash.<\/p>\n
Struggling For Cash<\/b><\/p>\n
According to Trace, the Financial Industry Regulatory Authority\u2019s bond- price reporting system, Molycorp\u2019s $230 million of 3.25% convertible notes, which are due 2016, traded at 76 cents on Wednesday. This marked a surge of almost 9 cents since May 27. According to the May 30 press release, Sydney based Lynas Corporation Limited (ASX:LYC)<\/b> sold shares in May to sustain its cash.<\/p>\n
Molycorp Inc (NYSE:MCP), which supplies rare-earths and molybdenum to companies, has been losing cash for nine consecutive quarters and is anticipated to run out of cash in a seven months period if the company does not improve operations. The market however shows potential of benefit to the company as new investments are being made in the industry, according to the director of convertibles at Boston-based Loomis Sayles & Co., Diana Monteith.<\/p>\n
Seeking Options<\/b><\/p>\n
Molycorp Inc (NYSE:MCP)\u2019s CEO Geoffrey Bedford, in a May 8 earnings call, said that increasing equity could help the company diminish its failure to generate free cash flow. Last year, the company had reported free cash flow that is the money it makes from its various operations, exclusive of capital expenses, was negative 4533.7 million. The company is under a debt of $1.47 billion with $67.7 million in interest costs in 2013, as per Bloomberg\u2019s data. It had a cash amount of $236.1 million as of March 31.<\/p>\n
According to a Stamford, Connecticut based analyst at CRT Capital Group Inc., Kevin Starke, investors expect the company to show positive growth later this year. The analysis is based on the assumption that the company\u2019s Mountain Pass, California Facility would by then become completely functional with fresh capital investment. The region, although has the largest deposits of rare earths, outside of China, has been operating at half its potential of 23,000 metric tons per year, highlighted by a May 9 report by JPMorgan Chase & Co. (NYSE:JPM).<\/b><\/p>\n","protected":false},"excerpt":{"rendered":"
Boston, MA 06\/20\/2014 (wallstreetpr) \u2013 Molycorp Inc (NYSE:MCP) surged highest in over a month\u2019s time after an insider sold shares and the company\u2019s Chief Executive […]<\/p>\n","protected":false},"author":32,"featured_media":24685,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":{"twitter_2902945987_2902945987":""},"rop_publish_now_history":[],"rop_publish_now_status":"pending","footnotes":""},"categories":[2236],"tags":[7521,2124,1628,7520,7519,3427,2857,603,1463],"stock_ticker":[],"class_list":["post-26672","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-asxlyc","tag-jpmorgan-chase-co","tag-jpmorgan-chase-co-nysejpm","tag-lynas-corporation-limited","tag-lynas-corporation-limited-asxlyc","tag-molycorp-inc","tag-molycorp-inc-nysemcp","tag-nysejpm","tag-nysemcp","entry"],"acf":[],"yoast_head":"\n