MP Materials Stock (NYSE: MP): Morgan Stanley Upgrade, Saudi JV and a 41% Pullback

MP Materials Corp (NYSE: MP) is closing out 2025 as one of the wildest rides in the S&P 500. After a year of government mega‑deals, geopolitical headlines and soaring rare‑earth prices, the stock now sits roughly 40% below its early‑year high but hundreds of percent above where it started the year. ^[1]

On December 5, 2025, the story added a fresh chapter: Morgan Stanley upgraded MP Materials to Overweight, a new batch of analyst targets landed in the $70–$80 range, and several in‑depth valuation pieces questioned whether the stock is now a strategic bargain or a speculative bubble. ^[2]

MP Materials stock on 5 December 2025: price and performance snapshot

As of mid‑afternoon trading on Friday, MP Materials shares were around $62.90, up about 1.8% on the day.

That comes after a 5.3% jump on Thursday, when the stock traded as high as $62.25 and closed around $61.85 on nearly 7.9 million shares, following renewed analyst optimism. ^[3]

From a performance standpoint:

Simply Wall St and Zacks data show year‑to‑date gains north of 270% and roughly 200% over the past 12 months, making MP one of the market’s strongest performers in 2025. ^[4]
The Motley Fool notes that the stock touched about $100 earlier this year and is now ~41% below that peak, underscoring how violent the recent correction has been. ^[5]

So you’re looking at a name that has:

Multibagger gains for early‑2025 buyers
A very real drawdown for anyone who bought near triple‑digit prices
Volatility that’s closer to an options chain than a sleepy miner

Fresh catalyst: Morgan Stanley’s upgrade and a wall of “Buy” ratings

The headline move on December 5 is Morgan Stanley’s upgrade of MP Materials from Equal‑Weight to Overweight, with a price target raised from $68.50 to $71. ^[6]

That call doesn’t exist in isolation:

StockAnalysis aggregates 12 covering analysts with a “Strong Buy” consensus and an average 12‑month target of about $70.92 (range $29–$112). ^[7]
GuruFocus puts the average Street target closer to $78.30, implying roughly 25–27% upside from current levels, and shows a consensus recommendation around “Outperform.” ^[8]
MarketBeat data shows a “Moderate Buy” average rating and an average target near $78.73, after a flurry of Buy or Outperform ratings from Goldman Sachs, DA Davidson, BMO, JP Morgan and others. ^[9]
Public.com lists 11 analysts with a Buy consensus and an average target of $74.09 as of December 5. ^[10]

Put together, most 12‑month targets cluster in roughly the $70–$80 band. From Friday’s ~$63 share price, that implies mid‑teens to high‑20s percent upside if those targets play out. ^[11]

However, not everyone thinks the stock is cheap:

GuruFocus’ GF Value model pegs fair value around $46, implying ~25% downside from current prices. ^[12]
Simply Wall St’s fresh December 5 piece runs a discounted cash‑flow model and concludes MP might be overvalued by about 278%, with an intrinsic value estimate near $16.34 per share. ^[13]

So the Street’s fundamental analysts mostly love the story; quant‑style valuation models are considerably more skeptical.

Q3 2025 earnings: revenue down, NdPr and magnetics at records

MP’s latest reported quarter, Q3 2025, is the foundation for much of today’s analysis.

According to the company’s earnings release and independent summaries: ^[14]

Revenue: $53.6 million, down ~15% year over year
Net loss: $41.8 million, vs. $25.5 million a year ago
Adjusted EBITDA: –$12.6 million
Adjusted diluted EPS: –$0.10, an improvement from –$0.12 in Q3 2024

The top‑line decline is not because demand disappeared. It’s because of a deliberate strategic decision:

MP stopped selling rare‑earth concentrate to China entirely, resulting in zero concentrate revenue in the quarter versus $43 million in the prior year. ^[15]

At the same time, the company is clearly scaling higher‑value products:

NdPr (neodymium‑praseodymium) oxide production hit 721 metric tons, up 51% year over year, with sales up 30% to 525 MT and an average realized price of $59/kg. ^[16]
The Magnetics segment generated $21.9 million in revenue and $9.5 million in adjusted EBITDA, with precursor magnet products ramping ahead of full magnet output. ^[17]

Management has guided to a return to profitability in Q4 2025, helped by a new government price‑protection agreement that started on October 1 and by continued ramp‑up in magnetics. ^[18]

So Q3 is best read as a transition quarter: ugly on traditional mining metrics, much better on the “mine‑to‑magnet” transformation the company is betting its future on.

The strategic moat: U.S. price floor, 10X magnet plant and Saudi refinery JV

1. The U.S. Department of Defense / Department of War deal

In July 2025, MP Materials announced a multibillion‑dollar public‑private partnership with the U.S. government aimed at breaking China’s near‑monopoly on rare‑earth magnets. ^[19]

Key structural pieces:

The U.S. Department of Defense becomes MP’s largest shareholder, acquiring $400 million of preferred stock plus warrants for an effective stake of about 15%. ^[20]
The government guarantees a price floor of $110/kg for NdPr, roughly twice past Chinese market levels, creating a powerful earnings floor for MP’s core product. ^[21]
MP will build a second U.S. magnet plant, the “10X Facility,” expected to begin commissioning around 2028 and bring total U.S. magnet capacity to 10,000 metric tons per year. Government commitments include 10‑year offtake for all magnet output. ^[22]

This is why multiple analysts describe the deal as “transformational”: MP is no longer just a price‑taking miner; it’s effectively being turned into a strategic infrastructure asset with minimum pricing and guaranteed demand.

2. Heavy rare‑earths and Mountain Pass expansion

In its Q3 release, MP confirmed plans to commission a new heavy rare‑earth separation facility at Mountain Pass around mid‑2026. ^[23]

The plant is designed to process ~3,000 MT of feedstock per year.
Initial focus is a Dy/Tb (dysprosium/terbium) circuit with 200 MT nameplate capacity, supporting premium grades of NdFeB magnets. ^[24]
Later phases add additional heavy rare earths and samarium around 2028, widening MP’s product portfolio. ^[25]

A DoD loan of around $150 million is supporting this expansion. ^[26]

3. Saudi Arabian joint venture with Maaden

On November 19, 2025, MP announced a three‑way joint venture with Saudi mining giant Maaden and the U.S. government to build a rare‑earth refining and separation facility in Saudi Arabia. ^[27]

Maaden will control at least 51% of the JV.
The U.S. side (MP + DoD/DoW) holds up to 49%, with public sources indicating the U.S. government fully finances its stake while MP contributes technical expertise and feedstock strategy. ^[28]
The facility will process both light and heavy rare earths from Saudi and other regions, strengthening non‑Chinese supply options for magnets and defense. ^[29]

The announcement triggered yet another spike in MP’s share price and is central to Simply Wall St’s December 3 valuation discussion, which estimates a fair value around $79.11, about 23% above recent prices, even while warning about execution risk and very high sales multiples. ^[30]

4. Apple and other commercial anchors

On the commercial side, MP has signed a $500 million long‑term magnet supply and recycling deal with Apple and is qualifying product for GM and other automotive and industrial customers. ^[31]

Apple has agreed to prepay up to $200 million, with $40 million received in Q3 and another payment of similar size expected in Q4, helping fund magnet expansion. ^[32]

Taken together, MP Materials is increasingly less like a typical cyclical miner and more like a government‑sponsored critical‑infrastructure project with blue‑chip offtake.

What today’s December 5 analysis is saying

Several in‑depth pieces landed today (or in the last 48 hours), giving a good snapshot of how the market is thinking about MP right now.

Motley Fool / Nasdaq: “After Falling 41% From Its Recent Peak…”

A Motley Fool article syndicated via Nasdaq frames MP as a national‑security‑driven growth story: ^[33]

It highlights the 41% drop from a ~$100 peak, despite major wins like the DoD partnership and Apple magnet deal.
The piece notes analysts expect EPS of about $0.56 next year and $1.12 by 2027, implying rapid earnings growth from today’s loss‑making base.
On those 2027 numbers, the article estimates MP is trading at roughly 52× forward 2027 earnings, calling out the rich valuation.

Conclusion: MP has huge strategic tailwinds, but the stock is “speculative and vulnerable to significant price swings”; investors should size positions carefully.

AInvest: “Is MP Materials’ 41% Pullback a Strategic Entry Point?”

AInvest leans hard into the geopolitical angle: ^[34]

MP is described as a “linchpin of U.S. supply chain security”, central to a 10‑year DoD offtake and price‑protection structure.
The article emphasizes 51% NdPr production growth in 2025, heavy‑rare projects and the Saudi JV as proof of operational and strategic momentum.
It points out that a 41% November pullback, driven by the end of concentrate sales to China and fears over Chinese export controls, may be out of sync with the company’s strengthened long‑term positioning.

However, AInvest also stresses execution risk around the Saudi refinery, heavy capex and dependence on U.S. government funding.

Simply Wall St: “Can MP Materials Rally Continue After 277% Surge…?”

A new Simply Wall St piece published December 5 focuses squarely on valuation after the 277% year‑to‑date rally: ^[35]

On a DCF basis, they arrive at an intrinsic value of about $16.34 per share, concluding MP is roughly 278% above that estimate.
Using sales multiples, they calculate a price‑to‑sales ratio of about 47×, versus an industry average around 2× and a “fair” ratio of roughly 2.6× for MP’s growth and risk profile.

Result: by these metrics, MP appears “significantly overvalued”, even though the same platform — in a separate November JV‑focused piece — shows some scenarios where fair value could be near $79. ^[36]

GuruFocus and others

GuruFocus’ note on the Morgan Stanley upgrade adds more colour: ^[37]

It lists a series of recent upgrades (BMO, JP Morgan, Deutsche Bank, Goldman Sachs, DA Davidson), many with targets between $71 and $82.
Aggregating 14 analyst targets, GuruFocus finds an average around $78.30, but its own GF Value model suggests fair value near $46.32, again implying downside relative to price.

Meanwhile, MarketBeat highlights MP’s 5.3% surge on December 4 and notes a “Moderate Buy” consensus rating and an average target of $78.73, while also pointing to insider selling, including significant share sales by the CEO, and continued negative GAAP margins. ^[38]

Consensus forecasts: a tough 2025, a big 2026–2027 ramp

Forecasts are aggressive, but broadly share the same shape: one more difficult year, then a sharp ramp as price floors, magnet volumes and JVs kick in.

From various data providers: ^[39]

Revenue:
- StockAnalysis’ consensus calls for ~$279 million of revenue in 2025, up about 37% year over year, then a jump to ~$685 million in 2026 (+145%).
- Zacks shows a similar pattern: ~40.9% revenue growth in 2025 and ~135.6% in 2026.
Earnings:
- Street models converge on a loss in 2025, around –$0.23 to –$0.29 per share, as MP absorbs high ramp‑up costs.
- For 2026, consensus moves to positive EPS between roughly $0.80 and $0.92, with some forecasts pointing to over $1 in EPS by 2027.

If those numbers are even directionally right, MP transitions over the next 24 months from loss‑making miner to profitable, vertically integrated magnet producer with government‑backed minimum pricing.

Valuation is where opinions explode:

Zacks calculates a forward 12‑month price‑to‑sales ratio near 16.7×, versus about 1.4× for the broader mining peer group, and gives MP a Value Score of “F”. ^[40]
Simply Wall St puts current trailing price‑to‑sales at ~47×, again far above industry norms. ^[41]

You can think of MP as being priced less like a miner and more like a high‑growth, government‑sponsored infrastructure/tech hybrid.

Macro backdrop: rare earths as a geopolitical chessboard

The context for all of this is that rare earths are now openly treated as strategic assets.

A Reuters piece today quotes European officials warning that while Europe must escape China’s grip on rare‑earth processing, it also has to avoid becoming overly dependent on the United States, pointing specifically to U.S. moves that are pulling rare‑earth value chains westward — including assets associated with MP. ^[42]

Separately, reporting on the U.S.–Saudi rare‑earths deal and the July DoD transaction makes clear that MP is now deeply embedded in U.S. industrial policy, with price floors, equity stakes and long‑term offtake contracts shaped explicitly around national‑security goals. ^[43]

The upshot: MP’s fortunes are no longer just about commodity cycles. They are tied to:

Future U.S. defense and industrial policy
U.S.–China trade tensions and export controls
U.S.–Saudi relations and Gulf industrial strategy
Europe’s attempts to diversify supply under its REsourceEU plan

That’s a powerful tailwind, but also a new layer of political and regulatory risk.

Key risks highlighted in current coverage

Across today’s research notes and recent articles, a few recurring risk themes show up: ^[44]

Execution risk on multiple mega‑projects
- MP must simultaneously ramp separated NdPr, bring heavy rare‑earth facilities online, scale the Fort Worth magnet plant, build the 10X Facility in the U.S. and execute the Saudi refinery JV. Any delays, cost overruns or technical issues could hit both earnings and investor confidence.
Dependence on government support
- The NdPr price floor, government equity stake, loans and Saudi JV funding are all ultimately political decisions. Changes in U.S. or Saudi policy, budget pressures or shifts in defense priorities could alter the economics.
Valuation compression risk
- If growth expectations step down — whether due to project delays, demand softness, or macro shocks — stocks trading at high‑teens to double‑digit sales multiples can re‑rate brutally. Simply Wall St’s 278%‑overvalued DCF and Zacks’ “Value Score: F” illustrate how fragile sentiment could be if the narrative turns.
Commodity and demand risk
- MP has some insulation via the NdPr price floor, but is still ultimately exposed to rare‑earth demand in EVs, defense, wind turbines and “physical AI” applications. A slowdown in EV adoption, for example, could ripple into magnet demand and contract renewals.
Geopolitical uncertainty
- China’s export controls, shifting alliances and potential trade escalations remain a wildcard. While such tensions have helped MP so far by raising the strategic premium on non‑Chinese supply, they also raise long‑term uncertainty and could invite retaliation.

Bottom line: what MP Materials stock represents as of December 5, 2025

Putting all the December 5 news, forecasts and analysis together:

Business trajectory: Operationally, MP is hitting production records, building out magnet capacity, adding heavy rare‑earth separation and locking in blue‑chip customers and government partners. ^[45]
Strategic position: It is now a central node in U.S. and allied efforts to de‑risk rare‑earth supply, with a price floor, equity backing and a Saudi JV that collectively reshape global refining routes. ^[46]
Valuation debate: Traditional value metrics scream caution (very high P/S, negative free cash flow, model‑driven fair values far below the share price), while most human analysts covering the stock keep raising targets into the $70–$80s and reiterating Buy or Strong Buy ratings. ^[47]

In practical terms, MP Materials has morphed into a geopolitical growth stock:

If the government price floor holds, the 10X Facility and Saudi refinery hit timelines, and magnet demand grows as forecast, current valuations could end up looking reasonable in hindsight.
If projects slip, policies shift, or demand underwhelms, the combination of high expectations and premium multiples leaves plenty of room for downside.

For anyone following or writing about the stock, the next inflection points to watch are:

Q4 2025 results and proof of the promised return to profitability. ^[48]
Concrete timelines and capex details for the Saudi JV and the 10X Facility. ^[49]
Updates on Apple/GM magnet shipments and heavy rare‑earth commissioning through 2026. ^[50]