USAR Stock Is On Its Hottest Streak Ever — Analyst Sees Over 30% Upside On $1.6B US Backing

• Shares of USA Rare Earth were up nearly 2% in after-market trading, with trading activity increasing heavily and the stock changing hands at nearly 13 times its average daily volume.
• The company said it would aim to achieve several targets by 2030, including extracting 40,000 metric tons per day of rare-earth and critical-mineral feedstock from USAR’s Round Top deposit.
• The average price target for the stock is $27.20, and it has an average rating of ‘Strong Buy’ according to Koyfin, with 5 analysts rating the company ‘Buy.’

USA Rare Earth shares closed nearly 8% higher on Monday, extending their rally to a record six consecutive sessions in the green after the Trump administration formally announced a $1.6 billion investment in the company earlier in the day.

Roth Capital analyst Suji Desilva said the additional actions planned by USA Rare Earth following the funding materially improve its prospects of building a fully domestic, end-to-end rare earth value chain over the next several years.

The highly anticipated government stake is expected to play a critical role in strengthening domestic production and supply chains for rare earth minerals. USA Rare Earth plans to deploy the capital to accelerate its growth strategy across mining, processing, metal production, and magnet manufacturing, aiming to establish a fully integrated U.S. operation by 2030.

Shares of USA Rare Earth were up nearly 2% in after-market trading, with trading activity increasing heavily and the stock changing hands at nearly 13 times its average daily volume.

The Rare Earth Deal

The Department of Commerce's CHIPS Program has issued a letter of intent totaling $1.6 billion, including $277 million in proposed federal funding and $1.3 billion in a proposed senior secured loan under the CHIPS Act.

In conjunction with this announcement, USAR has raised a common stock PIPE of $1.5 billion, anchored by Inflection Point, with participation from large mutual fund complexes.

The company said that by 2030, it would aim to achieve several targets, including extracting 40,000 metric tons per day of rare-earth and critical-mineral feedstock from USAR’s Round Top deposit, which is expected to begin commercial production in 2028.

Wall Street Happy With USAR

Roth Capital raised the firm's price target on USA Rare Earth to $35 from $25 and maintained a ‘Buy’ rating, according to The Fly. The new price target implies an upside of 31% from the company’s last closing price. The average price target for USAR is $27.20, and it has an average rating of ‘Strong Buy’ according to Koyfin, with 5 analysts rating the company ‘Buy.’

Roth Capital said the stake announcement, along with a concurrent $1 billion PIPE financing, serves to relatively fully fund plans to establish domestic production, including rare-earth or critical mineral extraction at Round Top by the end of the decade.

What Is Retail Thinking?

Retail sentiment on USA Rare Earth was in the ‘extremely bullish’ territory, compared to ‘bearish’ from a month ago, with message volumes at ‘extremely high’ levels, according to data from Stocktwits.

In the last 24 hours alone, retail message volume on the stock jumped nearly 300% on Stocktwits, and the stock saw a 13% spike in followers on the platform.

A user on Stocktwits noted that the stock is expected to return to $30.

Shares of USA Rare Earth have soared nearly 113% in the last 12 months.

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