MP Materials Stock Gets Another Upgrade. The Outlook Is Bright.

Coming into Friday trading, MP stock was down 42% over the past month, leaving shares up 269% this year. (Courtesy MP Materials)

Key Points

• MP Materials’ stock rose 2% on Friday.
• The U.S. Defense Department’s deal with MP Materials, including an equity stake and price floor, reshaped the domestic rare-earth industry.
• Wall Street analysts are upgrading MP Materials, with 81% rating shares at Buy.

Rare-earth stocks have taken it on the chin in recent weeks regardless of the enormous gains unleashed by America’s desire to end its dependence on Chinese critical minerals.

As the stocks fall, Wall Street is becoming more bullish on shares of MP Materials , the largest rare-earth producer in the Western Hemisphere.

Coming into Friday trading, shares of MP were down 42% over the past month, but up 269% this year. China is at the heart of both numbers.

MP stock, and shares of other rare-earth companies, soared in early October after China threatened rare-earth export restrictions, potentially upending production of everything from consumer electronics to fighter jets. Shares came back down as trade tensions between the U.S. and China eased, with the latter backing off its rare-earth threats.

Still, repeated threats by China, which dominates global rare-earth markets, led the U.S. Defense Department to enter into a deal with MP, which included an equity stake, a price floor, and a guaranteed customer. The deal completely reshaped the domestic rare-earth industry.

Estimates for earnings before interest, taxes, depreciation, and amortization, or Ebitda, by the end of the decade exploded from less than $200 million at the start of 2025 to almost $1 billion. (There aren’t that many estimates stretching out to 2030, however,)

The outlook is bright. That, and the recent declines, have Wall Street upgrading shares. Friday, J.P. Morgan analyst Bill Peterson upgraded MP stock to Buy from Hold. His price target actually went down $1 to $74 a share.

“Underappreciated national security importance and unmatched earnings visibility,” wrote Peterson. The U.S. is serious about building a domestic rare earth supply chain, and MP’s deal with the Pentagon gives it a lot of certainty about how MP’s business will look in the coming years.

“Our new rating reflects our view that rare earths national security concerns are ‘here to stay’ despite China’s reported one-year pause on export restrictions,” added the analyst. “Shares have come under pressure over the past month…which we feel offers an attractive entry point.”

MP stock, however, didn’t initially get a boost from the upgrade. Shares traded as low as $54.90 before rallying to $58.64, up 2% on Friday. The market deserved some blame for initial trading. The S&P 500 and Dow Jones Industrial Average began the day with steep losses but pared declines. For the day, the S&P dropped 0.1%, while the Dow lost 0.7%. Recent trading patterns probably played a role as well. MP stock has been incredibly volatile lately, scaring off some investors.

Overall, 81% of analysts covering MP stock rate shares at Buy, according to FactSet. The average Buy-rating ratio for stocks in the S&P 500 is about 55%. The average analyst price target is about $83 a share.

Earlier in the week, Deutsche Bank analyst Corinne Blanchard upgraded shares of MP Materials to Buy from Hold. Her price target went to $71 a share from $68.

Write to Al Root at allen.root@dowjones.com