I recently received an email from Dylan Jovine about a “tiny company” that he claims “could be the biggest, most lucrative opportunity of our lifetimes.”
According to Jovine, he’s “never seen anything with this kind of potential” in almost 30 years, and it all has to do with a small rare earth metals stock.
I’ve reviewed other Dylan Jovine presentations on this site that have made similar bold claims, but this is the first time I’ve seen him do one about a mining company.
Nevertheless, it’s all part of a sales pitch for his Breakthrough Wealth newsletter, which he’s selling for $997 through the presentation.
And as you may know, you need to join that service and see his report (“Unfair Advantage: This Rare Earth Stock Just Got Hired by The Pentagon”) to find out what he’s teasing.
But I think I know what his pick might be.
So, let’s take a look!
Unpacking Dylan Jovine’s “Rare Metals” Teaser
Dylan Jovine’s rare earth metals presentation reminded me of a different rare earth pitch I looked into last year from a “guru” named Matt McCall.
The essence of Jovine’s thesis is that rare earths are critical to the U.S. defense market. He also mentioned the importance of rare earths for the global electric vehicle and smartphone markets, but U.S. defense was the main thing he focused on in the presentation.
And according to Jovine, the Pentagon just gave “one tiny company” an “exclusive contract for getting these critical materials.”
“Without this material, our fighter jets wouldn’t fly…
“Our tanks wouldn’t move…
“And our missiles wouldn’t shoot.
“We’d be sitting ducks. We wouldn’t even be able to defend ourselves.
“But what most people don’t know…
“…Is that the Pentagon just gave one tiny company an exclusive contract for getting these critical materials.
“And the stock of this ‘unknown’ company is still only trading at $6 per share.”Source: https://go.behindthemarkets.com/bw-rare-earths
As a side point… the presentation referred to the company as a “tiny $5 micro-cap” at the outset, but Jovine also referred to it as a $6 stock three times in the main part of the presentation (including once where he called it a “$6 small-cap stock”).
So, the details are a bit murky, but his pick must be somewhere in that ballpark.
Anyway, in case you’re unfamiliar with rare earth metals (aka rare earth elements), according to Wikipedia, these represent “17 nearly-indistinguishable lustrous silvery-white soft heavy metals.” And the article says they have “diverse applications in electrical and electronic components, lasers, glass, magnetic materials, and industrial processes.”
As Jovine pointed out in the presentation, rare earths are also used in the defense industry.
And while he did say that he believes the company “is going to dominate a staggering combination of industries,” the main thing Jovine focused on was how, according to the presentation, rare earth metals are critical to national security.
“Now, according to some high-level figures in Washington…
“The Pentagon considers Rare Earth Metals to be CRITICAL to national security.
“That’s why they handed this small firm $150 million to develop a brand new processing facility down in Texas.”
Long story short… Jovine suggested that there could be an opportunity in the rare earth mining space because even though China currently controls the majority of the supply of rare earths, he says that thanks to the Pentagon, the company he’s teasing could help the U.S. shore up its own supply.
“What’s happening right now in the Rare Earth Metals market is even bigger.
“That’s because until recently…
“The US depended on China for its supply of Rare Earth Metals.
“But thanks to the Pentagon…
“The company I’m telling you about will end our addiction to Chinese Rare Earth Metals for good. “
I would suggest taking the presentation with a pinch of salt because, in my opinion, some of it comes across as sensationalist.
But it is true that China currently dominates the rare earths market.
As this document shows, the U.S. was the dominant rare earth element (REE) producer in the world from the mid-1960s to the mid-1980s, which was largely thanks to a mine in Mountain Pass, California.
However, China has managed to dominate this space in recent decades, and as this Forbes article points out, the U.S. is indeed working to secure rare earth elements for national security reasons and to help decrease its reliance on China.
Of course, that doesn’t mean that the company Dylan Jovine is pitching will make you money, let alone “10,000% returns over the next few years,” which is what he teased in the presentation.
But that’s the gist of his thesis.
And I was curious to know what company he was teasing, so I looked into his clues, and I think I’ve managed to solve it.
What Is Jovine’s Rare Earth Metals Pick?
The main clues Dylan Jovine shared were that the company he’s teasing has a “rare earth metals plant” in Texas, that it’s trading for around $6 a share, and that it was recently awarded a “$150 million Pentagon contract.”
Here’s a summary of what he said about the company:
“The company I’m telling you about will end our addiction to Chinese Rare Earth Metals for good.
“They just bought a location down in Texas where they’re building America’s first Rare Earth Metals plant.
“Just in time for the demand for Rare Earth Metals to skyrocket.
“And the small company I’m going to tell you about will be processing at least 500,000 tons of Raw Earth Metals per year.”
“This company is still relatively small –– and its shares are only trading at less than $6 per share.”
“The president has already used the Defense Production Act to fund the only Rare Earths Metal mine in the US.
“Which is going to supply one of only two Rare Earth plants in the US which is owned by our tiny company…”
“The $150 million Pentagon contract has already been signed.”
What could it be?
Based on the clues, I think Jovine’s pick could be Lynas Rare Earths Ltd (ASX: LYC).
The first thing I did to arrive at this conclusion was look into different rare earth mining companies with operations in the U.S.
And from there, I narrowed down the list to companies that have been awarded a Department of Defense contract to the tune of $150 million.
At first, the only contract I could find that came close to that figure was the contract Lynas’ wholly-owned subsidiary, Lynas USA LLC, signed with the DoD for $120 million in 2022.
However, further research revealed that Lynas was awarded a $30 million contract in 2021 as part of a plan to build a light rare earths separation facility.
So, that seems to match Jovine’s “$150 million Pentagon contract” clue.
But isn’t Lynas an Aussie company?
Yes. But the light rare earths separation facility it’s planning on building will be in Texas, and according to the above article I shared, it could be operational by 2025.
Regarding the company’s share price, Lynas is listed on the ASX and is currently trading at around $8.40 as of writing. However, if you convert that from AUD to USD, that currently works out to under $6, which matches his clue.
There’s also a Lynas ADR trading on the OTC under the ticker LYSDY, and that is currently trading at just under $6 as well.
So, Lynas looks like a match.
However, there were a couple of clues I wasn’t able to match.
First, Dylan Jovine said that the company he’s teasing “will be processing at least 500,000 tons of Raw Earth Metals per year.”
So, I could be wrong, but it looks as though Jovine’s pitch may have a typo.
In any case, the second clue that doesn’t quite fit was how Jovine referred to the company as a “small-cap stock” in the presentation, which technically means it’d have a market cap of under $2 billion.
And Lynas’ market cap is around AUD $7.7 billion as of writing, which works out to around USD $5.3 billion. Depending on who you ask, that could still be considered a relatively “small stock,” but it’s technically not a small-cap stock.
Nevertheless, all things considered, Lynas appears to be the closest match.
If you want to know what company Jovine is teasing for sure, then you’d need to fork out $997 for his Breakthrough Wealth service, as this is how you get the report.
I’m not a member of that service, but based on the sales material, it’s a newsletter focused on small (micro-cap) growth stocks he’s tracking.
Recommended: Go here to see my #1 rated stock advisory of 2023
Dylan Jovine seems to think that rare earth metals will become increasingly important to the U.S. in the years ahead, and he pitched a rare earth mining company, which, based on the clues, appears to be Lynas Rare Earths.
I can’t guarantee my guess is right, but that’s how it looks. And if you agree with my logic, at least now you don’t have to buy his service to find out.
If you’re still thinking of joining, however, I would recommend checking out my review of his flagship service, Behind the Markets, first.
That way, you can get an idea of how his more affordable service works (and how his picks have done) before making any decisions.
In any case, I hope this helps, and thanks for reading!