TMC Stock Shows Strong Momentum Amid Fundamental Weakness; Analysts Recommend Hold

Technical Analysis

TMC closed at $4.47 on May 30, 2025, up 2.76% from the previous session, maintaining strong upward momentum near its short-term resistance of $4.62. The stock trades well above both the 50-day ($2.87) and 200-day ($1.62) moving averages, signaling a sustained bullish trend over medium and long horizons. The RSI at 74 indicates an overbought condition, suggesting a potential short-term pullback or consolidation on June 2, 2025. MACD remains positive at 0.38, supporting ongoing bullish momentum. Volume slightly exceeds the average, confirming investor interest. The ATR value appears inflated relative to price levels, likely a data anomaly or reflects volatility in another metric; thus, it is less actionable here. Immediate support sits at $4.45, just below the last close, with a stop-loss suggested near $4.23.

Fundamental Analysis

TMC carries a market capitalization approximately $1.66 billion, positioning it as a small-cap entity with growth potential but inherent volatility. Its trailing twelve-month EPS remains negative at -$0.23, with a corresponding negative P/E of -19.43, indicating ongoing unprofitability. The discounted cash flow valuation is slightly negative, implying the stock currently trades above its intrinsic value. The company’s last 12-months earnings show no profitability, with the next earnings report due August 13, 2025, which could be a catalyst for future repricing. Analysts’ consensus holds at “Hold” with a uniform price target of $6.25, demonstrating moderate confidence in the stock’s upside from current levels but tempered by uncertain fundamentals.

Short-term Outlook

For the next trading day (June 2, 2025), slight profit-taking or consolidation is likely due to overbought RSI and resistance proximity; however, the overall trend supports a modest continuation or stabilization near $4.50. In the coming week, barring negative market-wide factors, momentum could push the stock towards the $4.62 resistance level, with potential to test higher if volume sustains.

Intrinsic Value and Long-term Potential

The negative DCF and lack of positive earnings indicate the intrinsic value remains below current trading price, suggesting the market is pricing future growth expectations rather than present fundamentals. Long-term investment viability hinges upon TMC’s ability to transition to profitability, improve cash flows, and capitalize on metals sector dynamics. Given solid moving average support and analyst price targets implying 40% upside, the stock presents speculative long-term interest conditional on fundamental improvements and sector recovery.

Overall Evaluation

TMC exhibits strong technical momentum and reasonable analyst optimism, but fundamental weaknesses persist, especially in profitability and cash flow. The stock qualifies as a “Hold” for now: it shows potential upside consistent with a growth story but carries risks due to negative earnings and intrinsic valuation disconnect. Investors focused on capital preservation may await clearer proof of earnings recovery, while momentum traders may capitalize on price action near resistance levels.