USA Rare Earth (NASDAQ:USAR) Shares Gap Down on Disappointing Earnings

USA Rare Earth Inc. (NASDAQ:USAR) shares gapped down before the market opened on Tuesday after the company announced weaker than expected quarterly earnings. The stock had previously closed at $8.76, but opened at $8.26. USA Rare Earth shares last traded at $8.3580, with a volume of 4,356,481 shares trading hands.

The company reported ($0.44) earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of ($0.19) by ($0.25). The business had revenue of $3.00 million for the quarter.

USA Rare Earth News Summary

Here are the key news stories impacting USA Rare Earth this week:

• Positive Sentiment: USA Rare Earth began commercial-scale shipments of heavy rare earth mixed carbonate from Serra Verde, with first sales in November under a 15-year offtake agreement. Production is targeted to reach an initial run rate of about 4,000 tonnes per year by Q2 2027. Shipment announcement
• Positive Sentiment: The company reported $1.2 billion in cash and delivered its first yttrium oxide samples to a major defense, medical and specialty-coatings customer for preliminary testing and prototyping—potentially broadening its commercial opportunities. Yttrium sample announcement
• Positive Sentiment: Cantor Fitzgerald kept an “overweight” rating while lowering its price target from $40 to $30, still implying substantial upside from the reported $8.76 share price. Cantor Fitzgerald ratings
• Negative Sentiment: Third-quarter results missed estimates: the company reported a $0.44-per-share loss versus the expected $0.19 loss, on revenue of $3 million. Higher expenses widened losses, while raw-material shortages constrained production. Q3 results coverage
• Negative Sentiment: Management delayed the Round Top report to Q3 2027, adding to execution uncertainty; coverage also highlighted increased cash burn. These issues may temper enthusiasm for the shipment and product-development milestones. Q3 earnings call highlights

Wall Street Analyst Weigh In

USAR has been the subject of a number of research reports. Wall Street Zen cut shares of USA Rare Earth from a “sell” rating to a “strong sell” rating in a report on Saturday, October 24th. Weiss Ratings restated a “sell (d-)” rating on shares of USA Rare Earth in a research note on Wednesday, November 4th. Jefferies Financial Group initiated coverage on shares of USA Rare Earth in a report on Wednesday, September 2nd. They set a “buy” rating and a $21.00 price target on the stock. Texas Capital upgraded shares of USA Rare Earth to a “strong-buy” rating in a research report on Tuesday, October 20th. Finally, Cantor Fitzgerald lowered their price objective on shares of USA Rare Earth from $40.00 to $30.00 and set an “overweight” rating for the company in a research report on Tuesday. One investment analyst has rated the stock with a Strong Buy rating, nine have assigned a Buy rating and one has assigned a Sell rating to the company’s stock. According to MarketBeat.com, the company has a consensus rating of “Moderate Buy” and a consensus price target of $32.29.

Institutional Trading of USA Rare Earth

A number of institutional investors and hedge funds have recently added to or reduced their stakes in USAR. BlackRock Inc. bought a new position in USA Rare Earth during the second quarter worth $335,795,000. Bank of America Corp DE acquired a new position in USA Rare Earth in the second quarter valued at $32,762,000. Weiss Asset Management LP bought a new stake in USA Rare Earth during the first quarter valued at $17,103,000. Korea Investment CORP bought a new stake in USA Rare Earth during the second quarter valued at $18,108,000. Finally, Bank of New York Mellon Corp bought a new stake in USA Rare Earth during the second quarter valued at $13,510,000.

USA Rare Earth Stock Performance

The stock has a fifty day simple moving average of $13.04 and a two-hundred day simple moving average of $18.53. The stock has a market capitalization of $2.01 billion, a price-to-earnings ratio of -3.41 and a beta of 2.79.

USA Rare Earth Company Profile

USA Rare Earth, Inc is developing a U.S.-focused supply chain for rare earth materials and permanent magnets used in electric vehicles, wind turbines, electronics, aerospace and defense applications. Its planned activities span mineral extraction, materials processing and magnet manufacturing.

The company is advancing the Round Top deposit in West Texas, a project that contains rare earth elements as well as other minerals used in advanced technologies. USA Rare Earth has described the deposit as a potential source of both light and heavy rare earths, which are important inputs for high-performance magnets and other industrial products.

USA Rare Earth is also developing magnet manufacturing capabilities in Stillwater, Oklahoma, and owns Less Common Metals, a U.K.-based producer of rare-earth metals and alloys.