USA Rare Earth Shares Surge 22.4% Amid New French Facility Announcement
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 22 2026
0mins
Source: Fool
- Stock Surge: USA Rare Earth shares rose 22.4% on Thursday to $23.20, reflecting strong market interest in rare earth mining, particularly amid renewed focus on critical minerals due to Trump Administration's threats over Greenland.
- New French Facility: The company's subsidiary, Less Common Metals Europe SAS, announced plans to develop a metal and alloy production facility in France, partially subsidized by the French government, which will significantly enhance production capacity and competitiveness in the European market.
- Accelerated Development Plan: USA Rare Earth selected Fluor Corporation and WSP Global as engineering, procurement, and construction partners for the Round Top project, planning to operate its demonstration plant in Colorado for 2,000 continuous hours while conducting geotechnical drilling, aiming to bring the project online by 2028, two years earlier than previous forecasts.
- Well-Funded Position: Although USA Rare Earth is currently pre-revenue, it reported $400 million in cash as of its third-quarter earnings, indicating strong potential in the rare earth sector, especially with ongoing trade negotiations with China and sustained demand for non-China sourced rare earths.
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Analyst Views on USAR
Wall Street analysts forecast USAR stock price to fall 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: 25.180
Low
15.00
Averages
22.75
High
28.00
Current: 25.180
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.
USA Rare Earth Closes $1.5 Billion PIPE Financing
- Financing Size: USA Rare Earth successfully closed a PIPE financing of approximately $1.5 billion, issuing about 69.8 million shares at $21.50 each, with proceeds aimed at accelerating the mine-to-magnet value chain development.
- Strategic Investment: The financing will support the company's fully integrated rare earth and permanent magnet supply chain across the U.S., U.K., and Europe, enhancing its market position in critical sectors such as defense and renewable energy.
- Market Impact: By collaborating with strategic investors like Inflection Point, the company not only secured funding but also strengthened its competitive edge in the rare earth sector, which is expected to drive future business growth.
- Legal Compliance: The transaction was not registered under the Securities Act of 1933, indicating the company's cautious approach to compliance while reflecting its adaptability to future market conditions.
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Rare-Earth ETFs Experience Sharp Volatility Reflecting Market Risks
- Policy-Driven Trading Risks: Rare-earth ETFs sharply retreated after last week's nearly 65% surge, particularly leveraged ETFs linked to USA Rare Earth Inc. (NASDAQ:USAR), which fell about 30%, highlighting the risks associated with high-leverage trading.
- Government Investment Commitment: The U.S. government announced a $277 million direct funding and a $1.3 billion loan to USA Rare Earth to strengthen domestic supply chains and reduce reliance on China, yet the selloff indicates investors are reassessing short-term expectations.
- Production Plans and Challenges: USA Rare Earth aims to begin mining operations in Texas by 2028, targeting production of up to 40,000 tons of rare-earth materials per day, but currently faces operational losses and negative cash flow, with production still years away.
- Market Sentiment Volatility: Despite REMX gaining over 120% last year, the recent pullback shows that even diversified ETFs are not immune to sentiment shifts in this volatile market, with leveraged ETFs amplifying market uncertainty through rapid swings.
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