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US Rare Earths: MP Materials Poised for Growth
5 Dec, 2025
Summary
- Morgan Stanley upgraded MP Materials, seeing benefit from US rare earth production efforts.
- Analyst highlights MP's domestic mine-to-magnet supply chain as a strategic advantage.
- A DoD-backed deal offers MP Materials significant upstream flexibility at zero capital costs.
Morgan Stanley has upgraded MP Materials, a rare-earth miner, to an overweight rating, forecasting potential gains of 15% for its shares. Analyst Carlos De Alba cited MP Materials' development of a fully domestic mine-to-magnet supply chain in the U.S. as a significant catalyst. This positions the company to benefit from U.S. efforts to diversify critical mineral sourcing away from China.
Despite a temporary pause in China's rare earth restrictions, De Alba emphasized ongoing U.S. critical mineral dependency and export license complexities. Geopolitical tensions, even if subdued, elevate MP Materials' strategic importance. Recent agreements, including a deal with the U.S. Department of Defense and Saudi Arabian Mining Company Maaden, underscore this value.
This strategic agreement involves the Defense Department financing the U.S. portion of a rare earth refinery in Saudi Arabia. It provides MP Materials with substantial upstream flexibility at zero capital cost. This collaboration solidifies MP Materials' role as a key U.S. solution for rare earth supply, supporting its vertical integration strategy.
