USA Rare Earth Aims to Complete Magnet Facility by 2026
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Source: Fool
- Market Dominance: In 2024, approximately 94% of sintered permanent magnets were produced in China, highlighting its dominance in the rare-earth market and prompting the U.S. government to expedite the establishment of a domestic supply chain for rare-earth magnets to reduce reliance on China.
- Project Potential: USA Rare Earth's Texas Round Top deposit contains 15 of the 17 rare earth elements, with plans to build a magnet facility in Oklahoma that is expected to supply high-performance magnets for electric vehicles, wind turbines, and other high-tech applications, indicating significant market potential.
- R&D Innovation: The company is developing new processing techniques at its Colorado R&D facility aimed at lowering extraction costs and minimizing environmental impact, which, if successful, could enhance its competitiveness in the rare-earth industry.
- Financial Risks: Despite the optimistic market outlook, USA Rare Earth currently lacks meaningful revenue and relies on financing to support early-stage activities, with its magnet facility not expected to be completed until 2026, exposing it to execution risks and financial pressures.
Analyst Views on USAR
Wall Street analysts forecast USAR stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for USAR is 22.75 USD with a low forecast of 15.00 USD and a high forecast of 28.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
5 Analyst Rating
5 Buy
0 Hold
0 Sell
Strong Buy
Current: 22.710
Low
15.00
Averages
22.75
High
28.00
Current: 22.710
Low
15.00
Averages
22.75
High
28.00
About USAR
USA Rare Earth, Inc. is a supplier of sintered neo magnets and other rare earth metals. The Company is engaged in developing a NdFeB magnet manufacturing plant in Stillwater, Oklahoma, and intends to establish domestic rare earth and critical minerals supply, extraction, and processing capabilities to both supply its magnet manufacturing plant and market surplus materials to third parties. It is focused on developing domestic rare earth production that offers sustainable and secure domestic supply of materials critical to key industries. Its vertically integrated approach consists of sourcing rare earth elements (REEs), in addition to other critical minerals such as gallium, to producing finished NdFeB magnets. The Company serve a variety of industries, such as defense, robotics, electric vehicles, wind power, appliances, cordless tools and computing and semiconductors. The Company owns, Less Common Metals Ltd., which is a scaled ex-China rare earth metal and alloy manufacturer.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
