Shares of USA Rare Earth extended their rally Monday after analysts at William Blair initiated coverage with an outperform-equivalent “Buy” rating, signaling that Wall Street’s enthusiasm for the company remains strong — even after a staggering 142% gain this year.
Wall Street’s New Favorite in the Rare Earth Boom
Analyst Neal Dingmann, who led the initiation, wrote that U.S. government investment in domestic rare earth supply chains is “far from over.” Although he stopped short of setting a price target, William Blair’s “Buy” rating typically indicates expectations that a stock will outperform the broader market.
USA Rare Earth’s shares jumped 14% to $31.59 following the note, outpacing the S&P 500 and Dow Jones Industrial Average, which each rose about 1.1% on the day.
“The company is among the few rare earth producers with a fully integrated value chain,” Dingmann wrote. “It owns a research arm developing proprietary extraction and purification technologies, a magnet manufacturing plant nearing production, and a controlling stake in the Round Top mine in Texas. The recent acquisition of Less Common Metals (LCM) adds advanced metal fabrication and strip-casting capabilities. Together, these assets position the company for sustained long-term value creation.”
Still in Development, but Investors Aren’t Waiting
Despite lacking meaningful revenue — as most of its projects remain under development — investor appetite has been relentless. The stock has surged more than 140% year-to-date, reflecting growing confidence in its role as a strategic U.S. supplier of rare earth materials.
That enthusiasm intensified after China announced plans to tighten exports of key rare earth elements, reigniting fears over global supply security. China dominates both production and processing of rare earths, materials essential for electric vehicles, wind turbines, and fighter jets.
The move underscored Washington’s vulnerability — and accelerated efforts to rebuild domestic capacity.
A Strategic Turning Point for U.S. Supply Chains
The shift is already reshaping the North American rare earth landscape. In July, the U.S. Department of Defense signed a landmark deal with MP Materials, the largest rare earth producer in the Western Hemisphere. The agreement included an equity stake, a floor price for rare earth products, and a commitment to purchase all of MP’s future magnet output — effectively guaranteeing a market for U.S.-made materials.
That pact sent MP’s shares soaring more than 400% this year, and it changed the industry overnight.
Dingmann believes USA Rare Earth could be next. “It’s a bold prediction,” he wrote, “but I wouldn’t be surprised if the U.S. government announces a major investment in the company.”
If that happens, the stock’s momentum may have further room to run.
Analysts Stay Bullish
According to FactSet, five analysts currently cover USA Rare Earth — and all rate it a Buy. For comparison, only about 55% of S&P 500 components carry a Buy rating.
Their average price target stands at $24, technically below the current trading level. But as Dingmann’s note illustrates, Wall Street has consistently underestimated the stock’s rally — with the latest targets now edging closer to $30 a share.
For investors betting on America’s push to rebuild critical mineral independence, USA Rare Earth has quickly become the sector’s most closely watched name — and, increasingly, one of its boldest bets.
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