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

Key Points

• Shares fell after USA Rare Earth reported a third-quarter loss of $0.44 per share, wider than analysts’ expected $0.19 loss; revenue was $3 million. The stock opened at $8.26, down from its prior close of $8.76.
• The company has begun commercial-scale shipments of heavy rare earth material from Serra Verde and reported $1.2 billion in cash, alongside delivering its first yttrium oxide samples to a prospective customer.
• Execution risks remain: raw-material shortages and higher expenses weighed on results, cash burn increased, and the Round Top report was delayed to Q3 2027. Cantor Fitzgerald maintained an overweight rating but cut its price target from $40 to $30.

USA Rare Earth Inc. (NASDAQ:USAR - Get Free Report)'s stock price 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) EPS for the quarter, missing analysts' consensus estimates of ($0.19) by ($0.25). The company had revenue of $3.00 million during the quarter.

Key Headlines Impacting USA Rare Earth

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

Analyst Upgrades and Downgrades

Several research analysts recently weighed in on USAR shares. Cantor Fitzgerald cut their target price on USA Rare Earth from $40.00 to $30.00 and set an "overweight" rating on the stock in a research report on Tuesday. Weiss Ratings reissued a "sell (d-)" rating on shares of USA Rare Earth in a research report on Wednesday, November 4th. Roth Capital dropped their price target on USA Rare Earth from $40.00 to $30.00 and set a "buy" rating for the company in a research note on Tuesday, July 21st. Texas Capital upgraded USA Rare Earth to a "strong-buy" rating in a report on Tuesday, October 20th. Finally, Jefferies Financial Group initiated coverage on USA Rare Earth in a report on Wednesday, September 2nd. They issued a "buy" rating and a $21.00 price objective on the stock. One equities research analyst has rated the stock with a Strong Buy rating, nine have given a Buy rating and one has assigned a Sell rating to the company's stock. Based on data from MarketBeat.com, the stock presently has a consensus rating of "Moderate Buy" and a consensus price target of $32.29.

Institutional Trading of USA Rare Earth

A number of hedge funds and other institutional investors have recently modified their holdings of USAR. Overbrook Management Corp acquired a new position in shares of USA Rare Earth in the third quarter valued at $3,145,000. BlackRock Inc. bought a new position in shares of USA Rare Earth in the second quarter valued at about $335,795,000. Weiss Asset Management LP acquired a new stake in shares of USA Rare Earth during the 1st quarter worth about $17,103,000. Encompass Capital Advisors LLC acquired a new stake in shares of USA Rare Earth during the 1st quarter worth about $7,038,000. Finally, Man Group plc acquired a new stake in shares of USA Rare Earth during the 2nd quarter worth about $2,562,000.

USA Rare Earth Stock Performance

The firm has a market cap of $2.01 billion, a P/E ratio of -3.41 and a beta of 2.79. The firm's fifty day moving average is $13.04 and its 200 day moving average is $18.53.

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.

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