MP Materials Stock Rises on Upgrade. Why the Analyst Sees a ‘Buying Opportunity.’

Coming into Monday trading, MP stock was down 25% over the past month but up 276% this year. (Courtesy MP Materials)

Key Points

• Deutsche Bank upgraded MP Materials stock to Buy from Hold, raising its price target to $71 from $68.
• MP Materials shares rose 9.5% Monday, following a 12.8% gain on Friday after strong third-quarter earnings.
• MP Materials, the only fully integrated rare-earth company in the West, is supported by the U.S. government.

Maybe the bottom is in for MP Materials stock and shares of other rare-earth companies.

Shares of some rare-earth miners rallied Monday after one caught a Wall Street upgrade following a month of painful declines.

Sunday, Deutsche Bank analyst Corinne Blanchard upgraded shares of MP Materials, the largest rare-earth miner in the Western Hemisphere, to Buy from Hold. Her price target went to $71 a share from $68.

“We believe MP now represents a buying opportunity for investors wanting to have exposure to the thematic of critical minerals and Rare Earth on the medium to long-term,” wrote Blanchard. “MP is the only player in the West as a fully integrated Rare Earth company, which is also backed up by the U.S. government.”

In July, the Defense Department signed a deal with the company that included an equity investment, price floor, and guaranteed customer for rare-earth magnets MP is building facilities to produce.

On Monday, MP rose 9.5%, closing at $64.18, while the S&P 500 and Dow Jones Industrial Average added 1.5% and 0.8%, respectively.

The move follows a 13% gain for MP stock on Friday. The company’s better-than-expected third-quarter earnings, reported on Thursday evening, were a relief for investors. Coming into the earnings report, MP stock had dropped 13 of 17 days since trading north of $100 in mid-October, following Chinese threats to restrict rare-earth exports.

Coming into Monday trading, MP stock was down 25% over the past month, leaving shares up 276% this year. The pattern for aspiring rare-earth miners USA Rare Earth and Ramaco Resources appears similar. USA Rare Earth stock was down 47% over the past month and up 51% for the year. Ramaco shares were down 48% over the past month and up 160% this year.

USA Rare Earth opened higher, but closed at $17.23, down 0.8%. Ramaco stock gained 0.6%, closing at $24.85.

After the recent spate of trade-induced volatility, investors may be able to get back to evaluating the outlook for the domestic rare-earth sector and figuring out what to pay for the stocks.

Blanchard’s target for MP stock is based on 18 times estimated 2028 earnings before interest, taxes, depreciation, and amortization, or Ebitda. MP’s Ebitda is expected to grow from about $245 million in 2026 to about $520 million by 2028, according to FactSet.

Overall, 75% of analysts covering MP stock rate the 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 for MP stock is about $83 a share.

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