Tech giant Apple’s (AAPL) $500 million agreement with MP Materials (MP), which is the only company currently operating a rare earth mine in the U.S., sent MP’s stock soaring. As part of the deal, Apple will purchase rare earth magnets from MP’s new facility in Fort Worth, Texas. In addition, a new recycling plant will be built at MP’s Mountain Pass mine in California that will reprocess used electronics for future Apple products, according to Fox News (FOXA). Although this move greatly benefits MP, it can also be seen as a big win for President Trump.
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This is because the agreement supports his goal of securing U.S. control over essential mineral supply chains, which is an area that he has consistently identified as key to national security. It is also in line with two of his administration’s top priorities: bringing manufacturing back to the U.S. and reducing the country’s reliance on China for vital resources. As a result, a senior White House official praised the agreement by saying that Trump “had the foresight to make this issue a priority” and applauded Apple for stepping up.
The timing of this announcement also strengthens Trump’s position on trade. Indeed, earlier this year, mineral shipments between China and the U.S. were halted after the White House imposed a series of tariffs. However, Trump recently reached a new agreement with President Xi Jinping to resume that trade on U.S. terms. With China currently producing 60% of rare earths and processing 90%, this deal with Apple suggests that Trump’s aggressive push for U.S. mineral independence is gaining traction.
Is Apple a Buy or Sell Right Now?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on AAPL stock based on 14 Buys, 10 Holds, and one Sell assigned in the past three months, as indicated by the graphic below. Furthermore, the average AAPL price target of $227.06 per share implies 7% upside potential.
