Shares of Molycorp Inc(NYSE:MCP) tumbled all of a sudden and erasing its early gain after a brief halt, as an SEC filing discloses an SEC investigation regarding the accuracy of disclosures of certain sales of stock by officers, directors and private equity firms, as well as certain corporate acquisitions during 2011.
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Late Thursday, the company reported a loss for the third quarter as higher costs associated with production couple with lower prices for rare earth metals cut into its profit margins. Molycorp reported a net loss of $15.5 million, or 19 cents a share, in the quarter ended Sept 30. That compared with earnings of $45.1 million, or 49 cents a share, in the year-earlier period.
The adjusted loss was 5 cents a share. Analysts, on average, had expected a loss of 7 cents a share. Revenue rose 49 percent to $205.6 million on sales of 4,391 tonnes of total rare earth and rare metal products.
The stock is now down 9% to $7.92 after hitting a new low of $7.57. However, the stock gapped up this morning and rose about 8% earlier in the session.