Retail Sentiment on TMC Has Flipped Bullish Even as the Stock Sits 17% Down This Year

Geopolitical uncertainty has been a boost for the critical minerals market, and TMC The Metals Company (NASDAQ: TMC) has emerged as one of the most high-profile speculative plays in the space. The company's growth strategy is built around extracting mineral nodules from the seabed of coastal waters. These nodules contain minerals including cobalt, copper, manganese, and nickel, and TMC is betting that it can gain the necessary regulatory approvals and begin mining these valuable resources underwater.

TMC went public through a merger with a special-purpose acquisition company in September 2021 and has seen some volatile swings since its debut. The company's share price is up 81% over the last year, but it's seen a big pullback from its high. The company's share price is down 50% from its valuation peak and 13.5% in 2026. On the other hand, the stock appears to be gaining favor among retail investors.

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Critical minerals are on retail investors' radar

A report published by Stocktwits recently highlighted the fact that overall sentiment among retail traders using its platform has shifted from bearish to bullish in recent months. Rising support from retail traders doesn't necessarily mean that the stock will go on to be a long-term winner, but it suggests support among a broadening base of shareholders and reflects rising interest in the broader critical-minerals space amid shifting geopolitical dynamics.

When the U.S. aimed to pressure China in trade negotiations with tariffs and restrictions on the exports of advanced artificial intelligence chips and semiconductor manufacturing equipment, Chinese officials flexed their own bargaining power stemming from their dominance of the critical minerals market. China accounts for the large majority of raw and processed critical minerals outputs, and its leadership in the category has become an economic and national security concern for the U.S. and its allies.

Can TMC stock deliver big wins for retail investors?

TMC has a market capitalization of roughly $2.2 billion despite having yet to record any sales across its time as a publicly traded company. That makes it a high-risk buy, but there are some signs that the company is making significant progress on its path to commercialization.

TMC announced in March that it had received some very good news from the National Oceanic and Atmospheric Administration (NOAA). The NOAA told the mining specialist that its consolidated mining application was in "substantial compliance" with the guidelines and standards outlined in the Deep Seabed Hard Mineral Resources Act.

With the news from the NOAA, TMC now expects to receive the necessary exploration and extraction permits needed to begin recovery operations within the next year. The Trump administration appears to be making domestic critical mineral sourcing a significant priority, and the deep-sea mining specialist appears to be operating in a favorable regulatory backdrop.

TMC estimates the net present value (NPV) of the minerals in areas it is targeting for extraction is $23.9 billion. If the company receives the necessary permits and begins demonstrating it can turn those targeted minerals into a substantial sales stream, the company's valuation could skyrocket. There's still a lot of uncertainty on that front, and the stock is a high-risk play, but recent regulatory news suggests TMC will at least get the chance to test whether its nodule extraction model is commercially viable.

Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.