Rare Earth Stocks: Analysts Say It’s Time to Jump In

Our digital age has a voracious appetite for rare earth elements – scarce metals found in small quantities but essential for the permanent magnets and battery alloys that drive everything from smartphones to defense systems. These materials are critical for powering hardware that demands high performance under extreme conditions.

But the demand doesn’t stop at consumer electronics. Rare earths are increasingly vital to the automotive sector, particularly as the electric vehicle (EV) market accelerates. Despite shifting political landscapes and evolving regulatory frameworks, EV adoption continues to climb – positioning the auto industry as a rapidly growing consumer of these strategic resources.

Reflecting this rising demand, Grand View Research estimates the global rare earths market was valued at $3.95 billion in 2024. That figure is set to rise, with a projected compound annual growth rate (CAGR) of 8.6% through 2030.

With that growth outlook in mind, some analysts are saying now’s the time to jump into rare earth stocks. Using the TipRanks platform, we’ve identified two names that are attracting bullish calls from the Street. Let’s take a closer look.

MP Materials (MP)

The first rare earth stock we’ll look at here is MP Materials, a Nevada-based rare earths company that operates on every level of the industry, from mining to metallization to manufacturing permanent magnets. The company is the leading rare earth producer in the US, and operates the Mountain Pass mine in California. The Mountain Pass operation is one of the world’s major rare earths production sites, featuring high-grade ores and approximately 1.9 million metric tons of rare earth oxides, enough to support decades of production. For now, the facility’s production equals more than 10% of the world’s rare earth supply.

On top of mining, MP Materials also handles rare earth refining at Mountain Pass, turning the raw ores into usable metals, compounds, and concentrates. The company’s refined products include neodymium-praseodymium oxide and metal, cerium chloride, lanthanum carbonate, and bastnaesite concentrate. These metals and products are used in a wide range of applications, including the manufacture of permanent magnets, water purification, and petroleum refining. In addition, MP Materials also produces various heavy rare earths in concentrate form, for use in the aerospace, defense, and electronics industries, and magnet products, as NdFeB alloy flakes or metallic blocks, both of which are essential in building EV batteries, among other applications. MP’s magnetics products are manufactured at the company’s Independence facility, located in Texas.

MP Materials was founded in 2017, specifically to redevelop the Mountain Pass mining site. At that time, the site was idle and likely headed for permanent closure; by putting the mine and its associated facilities back into operation, MP Materials restored a segment of the rare earths supply to the US domestic economy and supply chain. In addition, the company is working to establish itself in the global rare earth scene; in mid-May, MP Materials announced an exploration venture with the Saudi Arabian Mining Company to develop rare earths production in that country.

On the financial side, MP Materials reported its 1Q25 results on May 8. The company’s $60.8 million in revenue was up 25% year-over-year, although it missed the forecast by $1 million. At the bottom line, MP Materials had a non-GAAP EPS loss of 12 cents. This figure was a penny better than had been expected.

Analyst George Gianarikas covers this stock for Canaccord Genuity, and he starts with the impact of the US-China tariff competition before looking at MP’s potential for the coming months and years. Gianarikas writes, “As the geopolitical winds twist and turn, MP’s strategic prospects appear to be strengthening. The stock sold after the recent US/China rapprochement; we see the market’s reaction as shortsighted. While recent developments suggest that U.S. access to Chinese rare earth magnets has improved… we do not view this as a signal that U.S. efforts to establish a rare earth magnet supply chain independent of China will slow down. In our opinion, the recent reduction in tariffs, at least, affords MP the option to begin reselling REO concentrate back to China for processing. In the meantime, MP — and the US administration at large — appear to be full speed ahead in establishing a new rare earth magnetics supply chain.”

Gianarikas gives this rare earths stock a Buy rating, with a $27 price target to suggest a one-year upside potential of 23%. (To watch Gianarikas’s track record, click here)

The 8 recent analyst reviews here include 5 to Buy and 3 to Hold, for a Moderate Buy consensus rating. The stock is priced at $22 and its $26.29 average target price implies that a one-year gain of 19.5% is in store for the shares. (See MP stock forecast)

USA Rare Earth (USAR)

Next on our list is USA Rare Earth. As its name suggests, this company aims to become a competitor of MP Materials, and to expand the playing field of rare earths producers in the US. USA Rare Earth describes its mission as establishing a rare earth magnet supply chain in the US domestic market; practically, this means that the company is in the process of developing a new rare earth magnet facility in the States.

Specifically, the company is commissioning a new production lab in Stillwater, Oklahoma, with the goal of working with customers this year. The facility is planned for initial production of 5,000 metric tons at full capacity. USA Rare Earth plans for this facility to serve the domestic US industrial demand for rare earths, particularly in such fields as defense, robotics, EVs, and semiconductors – as well as more mundane fields such as cordless tools.

The company’s Oklahoma facility is backed up by the company’s West Texas Round Top Deposit, which contains 15 out of 17 rare earth elements. USA Rare Earth is setting up a supply chain, so that the mining operation in Texas can supply the Oklahoma manufacturing plant. Finally, USA Rare Earth also has an R&D facility, located in Wheat Ridge, Colorado, tasked with developing new methods of extracting rare earth elements from the ores.

USAR went public in March of this year, through a SPAC transaction with Inflection Point Acquisition Corporation II. The business combination officially closed on March 13, and the new USAR ticker started trading on March 14. The total investment in USAR, through the business combination and the pre-funded PIPE investors, came to nearly $50 million.

In May, USAR released its first public set of business results. Since the SPAC closed, the company has achieved several important milestones – it has opened the Oklahoma facility; it has brought on board key positions, in engineering, production, finance, and operations; it has signed its first MOU with a customer; and it has produced from the Round Top Deposit a quantity of dysprosium oxide with 99% purity.

These are important achievements, and have led Roth’s Suji Desilva, an analyst who ranks amongst the top 2% of Wall Street stock pros, to take an upbeat look at this company and its newly public stock. The 5-star analyst writes, “We expect USAR to grow with shifting US government and commercial demand away from China REE suppliers, who dominate the market today. While REE market demand comes from a broad set of end markets, we believe near-term domestic REE demand will be catalyzed by the unacceptable risk associated with China supplier exposure for US military/defense and automotive customers, including highly sensitive programs such as F-35 fighter jets and naval destroyers/submarines. We are encouraged by USAR’s strong execution into the industrial-grade REE magnet market, which can fuel near-term revenue ramp as the company scales up its supply chain capability.”

To this end, Desilva rates USAR as a Buy, and sets a $15 price target for the coming 12 months. If met, the figure could yield returns of 65% over the one-year timeframe. (To watch Desilva’s track record, click here)

USAR has slipped under most analysts’ radar; its Moderate Buy consensus is based on just two recent ratings – but both are Buys. Meanwhile, the $15 average price target matches Desilva’s objective. (See USAR stock forecast)

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Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.