MP Materials Gains 108% in a Year: How to Play the Stock?

MP Materials MP shares have soared 107.8% in the past year, outperforming the industry’s 56.6% growth, the Zacks Basic Materials sector’s 49% rise and the S&P 500’s gain of 24%.

MP’s Performance Against Industry, Sector, S&P 500 & Peers

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Within the rare earths space, peers Lynas Rare Earths Limited LYSDY and Energy Fuels UUUU have delivered stronger returns during the same period, rallying 181% and 358%, respectively.

Against this backdrop, it becomes essential to assess whether MP’s rally still offers upside by examining the key drivers behind its performance, the sustainability of these factors and the company’s growth outlook and risks.

MP 2025 Highlights: Mixed Results, Solid Partnerships

Revenues increased 10% year over year to $224 million in 2025 on higher NdPr oxide and metal revenues as well as revenues from the sales of magnetic precursor products. This was partially offset by lower rare earth concentrate revenues.

Adjusted earnings per share in 2025 were a loss of 24 cents, reflecting higher legal costs, as well as increased advanced projects and development expenses. MP had reported an adjusted loss of 44 cents in 2024.

Last year, MP Materials entered into a long-term agreement to supply U.S.-made recycled rare earth magnets to Apple and a public-private partnership with the U.S. Department of War to accelerate a fully integrated domestic magnet supply chain. Backed by government incentives, the company will construct the 10X Facility. MP also expects to extend the lifespan of Mountain Pass through further exploration and enhanced processing.

The company also partnered with the DoW to establish a joint venture with the Saudi Arabian Mining Company (Maaden) to develop a rare earth refinery in the Kingdom of Saudi Arabia. This will leverage Saudi Arabia’s competitive energy base, solid infrastructure and the untapped rare earth resources.

MP Materials’ Operational Momentum Remains Strong

MP Materials demonstrated solid operational progress in 2025. NdPr oxide production doubled to a record 2,599 metric tons, reflecting ongoing process optimization and capacity ramp-up. In 2026, MP Materials expects to continue delivering growth in NdPr output. Rare earth oxide concentrate production also reached a record 50,692 metric tons, marking a 12% year-over-year increase driven by improved recoveries and operational efficiencies.

The company produced its first magnets on commercial-scale equipment at the Independence facility, marking a key milestone in its downstream magnet manufacturing strategy. MP received the final $50 million prepayment for magnetic precursor products under its long-term supply agreement with General Motors.

MP Material’s Earnings Estimates Trend Downward

The Zacks Consensus Estimate for MP’s 2026 and 2027 earnings moved south over the past 90 days.

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Despite the downward revision, the Zacks Consensus Estimate for 2026 earnings is pegged at 35 cents per share, indicating a turnaround from the loss of 24 cents in 2025. The estimate for 2026 is pegged at a profit of $1.13, indicating a solid 221% improvement.

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MP Materials Stock Trades at a Premium

MP is trading at a forward 12-month price/sales multiple of 16.51X, a significant premium to the industry’s 1.60X. The company’s Value Score of F suggests that the stock is not so cheap and has a stretched valuation at this moment.

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Energy Fuels is trading higher at 24.59X while Lynas is comparatively a cheaper option, trading at 12.84X.

MP Materials Seems Well-Positioned for Long-Term Growth

The company plans to break ground on the 10X Magnetics facility in Northlake, TX, in 2026 while ramping magnet production for General Motors. The 10X Facility will be the company’s second domestic rare earth magnet manufacturing facility and is expected to begin commissioning in 2028. It is projected to produce an estimated 7,000 MTs of magnets per year.

Combined with the Independence facility’s 3,000 MT magnet capacity, MP Materials’ overall U.S. rare earth magnet production capacity will expand to 10,000 MT per year. This will significantly boost domestic output to serve both defense and commercial customers.

Our Verdict on MP Stock

MP Materials presents a compelling long-term growth narrative supported by unique U.S. strategic positioning, expanding magnet production and strong partnerships with major industrial and technology players. Existing shareholders may benefit from staying invested to capture these long-term fundamentals.

However, new investors can wait for a better entry point, considering the premium valuation and recent downward revisions to earnings estimates. MP currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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