Is MP Materials Stock a Buy After More Than 30% Pullback?

MP Materials (MP), the only large-scale rare earth operator in the United States, has seen its stock price pull back more than 30% from its peak following an astonishing surge of over 350% year-to-date, sparking widespread market attention. Supported by multiple positive factors including government backing, partnerships with industry giants, and strategic transformation, is this current adjustment a precursor to a bubble burst, or a prime opportunity for long-term investment positioning?

MP Materials’ core competitiveness stems from its monopolistic industrial position. Its Mountain Pass mine in California supplies over 10% of the world’s rare earths and is the only large-scale rare earth mining and processing base in the United States. Against the backdrop of ongoing China-US trade frictions, the importance of rare earths as a strategic resource has been elevated to an unprecedented level.

In July, the U.S. Department of Defense invested $400 million to become its largest shareholder and committed to purchasing all neodymium-praseodymium (NdPr) output from its new “10X Facility” at a guaranteed price of $110 per kilogram—a 41% premium to the current market price of $78 per kilogram. This ten-year purchase agreement not only secures a substantial revenue floor for MP Materials but also signifies its deep integration into the U.S. supply chain security system.

2025 marks a year of strategic transformation for MP Materials. The company decisively halted shipments of rare earth concentrate to China, which, despite reducing concentrate revenue to zero in the third quarter, accelerated its push downstream into the supply chain.

The $500 million partnership with Apple is of milestone significance. Starting in 2027, MP Materials will become the exclusive supplier of US-made magnets for hundreds of millions of Apple devices. This move not only opens a stable demand channel but also validates its technological upgrading capabilities.

Last week, the company announced a joint venture with the U.S. Department of Defense and Saudi state-owned mining giant Ma’aden to establish a rare earth refinery in Saudi Arabia. MP Materials described this move as a “key step in reshaping the global rare earth supply chain.”

Although the company is still in its investment phase, reporting a year-over-year revenue decline and cash outflow in the third quarter, its balance sheet remains healthy. As of the end of Q3, $1.9 billion in cash and short-term investments (including a recent $650 million equity financing) provides ample buffer for advancing its factory construction. Management expects to achieve profitability in the fourth quarter, which could be a critical turning point for validating its business model.

The current stock price pullback primarily reflects market concerns over two major uncertainties: the progress of magnet production ramp-up and fluctuations in global rare earth prices. However, these short-term factors precisely present a window of opportunity for long-term investors.

Behind the company’s $11 billion market capitalization lies the unique platform value of the US rare earth magnet market, whose annual output value is expected to exceed tens of billions of dollars. Considering the price protection of defense orders and the certainty of long-term supply agreements with Apple, the current valuation has already absorbed some of the earlier overheated expectations.

In summary, the recent pullback in MP Materials’ stock price is more attributable to market sentiment fluctuations and profit-taking rather than a deterioration in fundamentals. Amid the macro trend of the US government steadfastly promoting the reshoring of key supply chains and global tech giants seeking supply chain diversification, the company’s position as the core vehicle of US rare earth strategy is increasingly solidified. For investors who can tolerate stock price volatility and adhere to a long-term investment philosophy, this pullback may constitute a rare entry opportunity.