BMO Capital Markets thinks that MP Materials ‘ massive surge in 2025 is set to continue higher from here. The bank upgraded the rare earth miner to an outperform rating from market perform. However, analyst Raj Ray lowered his price target by $1 to $75 per share. MP Materials stock has surged 254% this year. Ray’s updated forecast implies another 36% rally ahead. MP YTD mountain MP YTD chart Raj said that rare earth multiples have pulled back from their previous highs as tensions between the U.S. and China have thawed significantly, with Beijing agreeing to pause some of its export controls following a meeting between President Donald Trump and China’s Xi Jinping. However, Raj doesn’t believe that this U.S.-China deal should weaken the rare earth theme. “The recent trade tensions concerning rare earths have highlighted the vulnerability of the U.S. supply chain. Although there has been a temporary halt in export bans from China, we believe this will not deter the U.S. from pursuing its policy goals of on shoring rare earth supply,” he wrote. Raj also pointed to the joint venture between MP Materials, the Department of Defense and Saudi Arabian mining company Maaden as another catalyst for the stock. Under the deal, MP Materials will develop a rare earth refinery in Saudi Arabia, and — alongside the Pentagon — will hold a 49% stake in the joint venture. The DoD will finance the U.S. share of development capital expenditures. Going forward, Raj sees multiple tailwinds ahead including a $500 million commitment from Apple to buy rare earth magnets developed at MP Materials’ Independence facility. “We believe the focus now turns to executing the ambitious, yet manageable growth plan, in our view. We note the potential for multiple expansion upon successfully executing the ramp up at Independence,” he wrote. “Additionally, areas of potential upside include: (i) additional production from the Apple recycling partnership, and (ii) new 10X offtake contracts with more lucrative pricing compared to the DoW offtake.”
