MP Materials 1 96% Drop and 215th Trading Volume Rank Signal Insider Selling vs Institutional Buys Amid Strategic DoD Ties and 300% YTD Surge

On September 3, 2025, MP Materials (MP) fell 1.96% with a trading volume of $0.48 billion, a 22.46% decline from the previous day, ranking 215th in market activity. The stock has surged over 300% year-to-date, driven by its strategic partnership with the U.S. Department of Defense and plans to build a new magnet facility. Record Q2 2025 production levels have bolstered investor optimism about its role in critical minerals and EV supply chains, though sustainability of growth remains debated.

Insider trading data reveals heavy selling by executives. CEO James Litinsky sold 2 million shares valued at $53.7 million, while CFO Ryan Corbett and General Counsel Elliot Hoops sold 75,000 and 24,536 shares, respectively. This outflow contrasts with institutional activity: 258 funds added MP shares in Q2 2025, including Caxton Associates and JPMorgan Chase, which increased holdings by over 500%. Conversely, Price T Rowe Associates reduced its stake by 88.8%, signaling mixed institutional confidence.

Analyst sentiment remains cautiously positive. Three firms, including Canaccord Genuity and Baird, issued "Buy" or "Outperform" ratings in July-August 2025, with median price targets at $64.5. However, divergent price targets—from $29 to $77—highlight market uncertainty. The Department of Defense’s $400 million investment in MP to expand rare earth processing underscores its strategic value amid global supply chain shifts and China’s export restrictions on critical minerals.

Recent geopolitical tensions and U.S. policy shifts, including expedited permitting and $1 billion in DOE funding, aim to reduce reliance on Chinese processing. MP’s Mountain Pass facility, now under DOD and Apple offtake agreements, is central to this reshoring effort. Despite record production, insider selling and institutional divestments suggest ongoing skepticism about long-term profitability amid volatile demand from robotics, eVTOLs, and defense sectors.