The US government has invested in a new fund to invest in critical minerals alongside Orion and Abu Dhabi’s ADQ https://t.co/CAyvLkRwIg ...

Core Viewpoint - Lithium Americas (LAC) experienced a significant decline in stock value after an initial surge, raising questions about the sustainability of government support and the company's valuation [1][2][3]. Group 1: Stock Performance - LAC shares surged over 227% from September 23 to October 14, closing above $10, following a 5% equity stake acquisition by the U.S. Department of Energy [1]. - The stock has since dropped to $7.09, representing a decline of over 32% from its peak closing price [2][3]. - Analyst Bill Peterson downgraded LAC from "Neutral" to "Underweight," setting a price target of $5, indicating a potential 50% downside from previous levels [2]. Group 2: Government Involvement - The 5% equity stake was part of a restructured loan agreement, raising doubts about whether it reflects confidence in LAC's growth prospects [3][5]. - The restructuring allows LAC to access $435 million of a $2.26 billion loan for the Thacker Pass project, with a commitment to establish a $120 million loan reserve account within a year [4]. - Government involvement appears more focused on protecting taxpayer interests rather than supporting LAC's potential upside [5]. Group 3: Analyst Sentiment - Analysts are divided on the long-term viability of LAC, with skepticism regarding sustained government support [3]. - Peterson noted that the potential upside does not justify LAC's current valuation when considering dilution and revised loan terms [6]. - The broader analyst community shares concerns about LAC's valuation amidst recent stock performance [6].

Core Viewpoint - The Trump administration is actively investing in specific stocks, marking a shift from historical practices where the White House avoided picking market winners [1] Group 1: Government Investments - The administration has directed investments into companies such as Intel, Trilogy Metals, Lithium Americas, and MP Materials, leading to significant stock price increases [1][2] - New potential investments are rumored for USA Rare Earth and Critical Metals, which could also see stock price surges if government stakes are confirmed [2] Group 2: Stock Performance - MP Materials received a $400 million investment from the U.S. Department of Defense, resulting in a 150% increase in stock price [3] - Intel's stock rose by 49% following an $8.9 billion government stake [3] - Lithium Americas saw a 45% increase after a planned 5% stake by the U.S. Department of Energy [4] - Trilogy Metals' stock surged by 240% after a $35.6 million investment from the government [4] Group 3: Industry Context - The U.S. government aims to secure supplies of rare earth metals and lithium, which are critical for high-tech devices and defense technologies [5][6] - Rare earth metals, while not rare in occurrence, are essential for various technologies, and the U.S. currently relies heavily on China, which produces 60% of the world's rare earths [6][7] - Lithium is abundant in the U.S., but extraction requires advanced technologies due to the unconventional nature of most resources [7]

Core Viewpoint - The Trump administration has taken direct ownership stakes in five major publicly traded companies as part of a national security strategy aimed at securing domestic supply chains for semiconductors, critical minerals, and steel [1]. Group 1: Government Acquisitions - The government acquired a 10% stake in Intel Corp. (NASDAQ: INTC), a 15% stake in MP Materials (NYSE: MP), a 10% stake in Lithium Americas Corp. (NYSE: LAC), a 10% stake in Trilogy Metals Inc. (NYSE: TMQ), and a "golden share" in US Steel Corporation [2]. - The investment in Intel was facilitated by converting previously awarded CHIPS Act grants into a $5.7 billion investment, aimed at preventing a potential spinoff of Intel's unprofitable foundry business [9]. - The Department of Defense acquired a 15% stake in MP Materials, which operates the only fully integrated rare earth mining and processing facility in the U.S. [9]. Group 2: Company Performance - Intel's stock rose nearly 47.54% from $24.80 on August 22 to $36.59 by October 6 [9]. - MP Materials' stock increased by 64.77%, from $45.11 to $74.33, since the acquisition on July 11 [9]. - Lithium Americas' stock advanced by 20% from $7.04 to $8.45 following the government's stake acquisition on October 1 [9]. - Trilogy Metals' stock surged 215.30% in after-hours trading following the announcement of a $35.6 million investment [10]. Group 3: Strategic Implications - The acquisition of a "golden share" in US Steel grants the U.S. government permanent veto authority over key corporate decisions, reflecting a unique arrangement in corporate governance [13]. - The administration is considering further investments in major defense contractors, indicating a potential expansion of this strategy [11].

Potential Investment & Negotiation - The US President proposed that Intel should give 10% of the company to the US, which equates to approximately $10 billion [2] - Initially, the President indicated Intel's CEO agreed to the 10% deal [2] - A White House official described the conversation as ongoing, with many details still to be agreed upon [3][4] - The final terms, including the US government's level of influence and the actual equity stake, are not yet finalized [4] - The meeting's outcome is uncertain, and any potential signing is not guaranteed [4][5] Key Participants - Intel CEO, Lip Boutan, is scheduled to meet with President Trump at the White House [1] - The discussion involves a potential deal where Intel would give a stake to the US government [1]