Stock Traders Buy High Volume of Call Options on USA Rare Earth (NASDAQ:USAR)

Key Points

• Traders bought an unusually large volume of calls — 70,652 call options on NASDAQ:USAR on Monday, a 39% increase versus average, indicating heightened bullish derivatives activity.
• USA Rare Earth announced a $2.8B acquisition of Serra Verde that includes a 15-year, 100% offtake arrangement backed by a U.S. government‑capitalized SPV, strengthening its mine‑to‑magnets supply chain and Western competitive position while creating dilution and financing risk given the company’s negative EPS and small revenue base.
• Shares jumped 10.9% to $22.13 on heavy volume; insiders increased holdings and Wall Street sentiment is mostly positive with a consensus "Moderate Buy" and an average target near $29.50.

USA Rare Earth Inc. (NASDAQ:USAR - Get Free Report) was the recipient of unusually large options trading on Monday. Traders purchased 70,652 call options on the company. This represents an increase of 39% compared to the average volume of 50,796 call options.

Key Stories Impacting USA Rare Earth

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

• Positive Sentiment: Acquisition secures a scaled producer of all four magnetic rare earths (Nd, Pr, Dy, Tb) and a 15-year, 100% offtake arrangement backed by a U.S. government‑capitalized SPV and private partners — a major de‑risking of future sales and revenue visibility. GlobeNewswire Release
• Positive Sentiment: Deal strengthens USA Rare Earth’s mine-to-magnets supply chain and positions the company as a Western alternative to China — a compelling geopolitical narrative that can attract strategic investors and government support. CNBC Coverage
• Positive Sentiment: CEO Barbara Humpton and Serra Verde’s CEO discussed the deal, production profile and funding on Squawk Box—management is publicly outlining funding plans and synergies, which supports market confidence. Squawk Box Interview
• Neutral Sentiment: Wide media coverage (WSJ, Invezz, MSN and others) is amplifying visibility and trading volume; that can increase liquidity and volatility but doesn’t by itself guarantee sustained price direction. WSJ Article
• Negative Sentiment: The $2.8B cash‑and‑stock structure raises dilution and financing risk—equity-funded deals often pressure shares despite strategic merits. Market commentary flagged dilution as a near-term concern. Invezz Coverage
• Negative Sentiment: Recent fundamentals show small revenue and negative EPS (quarterly miss), so financing a large deal and executing integration will be closely scrutinized by investors; execution risk and leverage are downside catalysts. Schaeffer's Summary

USA Rare Earth Stock Up 10.9%

Shares of NASDAQ:USAR traded up $2.18 during midday trading on Monday, reaching $22.13. 26,474,789 shares of the company traded hands, compared to its average volume of 18,240,754. The firm has a market capitalization of $4.82 billion, a price-to-earnings ratio of -7.37 and a beta of 1.34. The firm's fifty day moving average price is $18.22 and its two-hundred day moving average price is $18.85. USA Rare Earth has a 12 month low of $8.00 and a 12 month high of $43.98.

USA Rare Earth (NASDAQ:USAR - Get Free Report) last announced its earnings results on Monday, March 30th. The company reported ($0.19) earnings per share for the quarter, missing analysts' consensus estimates of ($0.12) by ($0.07). The business had revenue of $1.64 million during the quarter.

Wall Street Analyst Weigh In

A number of equities research analysts have issued reports on the stock. Roth Mkm set a $25.00 price objective on USA Rare Earth and gave the stock a "buy" rating in a research report on Thursday, April 9th. Cantor Fitzgerald lifted their target price on USA Rare Earth from $28.00 to $35.00 and gave the stock an "overweight" rating in a research note on Friday, January 30th. Weiss Ratings reiterated a "sell (d-)" rating on shares of USA Rare Earth in a research note on Friday, March 27th. Wedbush started coverage on USA Rare Earth in a research note on Monday. They set an "outperform" rating and a $29.00 target price on the stock. Finally, Benchmark started coverage on USA Rare Earth in a research note on Wednesday, January 21st. They set a "buy" rating on the stock. Seven analysts have rated the stock with a Buy rating and one has given a Sell rating to the company's stock. Based on data from MarketBeat, USA Rare Earth currently has a consensus rating of "Moderate Buy" and an average target price of $29.50.

Insider Activity at USA Rare Earth

In other news, Director Carolyn Trabuco bought 1,300 shares of the business's stock in a transaction that occurred on Thursday, January 29th. The shares were bought at an average cost of $22.60 per share, for a total transaction of $29,380.00. Following the acquisition, the director directly owned 1,300 shares in the company, valued at approximately $29,380. This trade represents a ∞ increase in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, Director Michael Blitzer bought 100,000 shares of the business's stock in a transaction that occurred on Thursday, January 29th. The stock was purchased at an average price of $21.44 per share, for a total transaction of $2,144,000.00. Following the completion of the acquisition, the director owned 847,500 shares in the company, valued at $18,170,400. This represents a 13.38% increase in their ownership of the stock. Additional details regarding this purchase are available in the official SEC disclosure. Insiders own 46.60% of the company's stock.

Institutional Trading of USA Rare Earth

Several hedge funds and other institutional investors have recently bought and sold shares of the company. RFG Advisory LLC bought a new position in USA Rare Earth during the 1st quarter worth approximately $162,000. SG Americas Securities LLC grew its position in USA Rare Earth by 150.0% during the 1st quarter. SG Americas Securities LLC now owns 22,653 shares of the company's stock worth $343,000 after acquiring an additional 67,997 shares during the last quarter. Caitong International Asset Management Co. Ltd bought a new position in USA Rare Earth during the 4th quarter worth approximately $39,000. Virtu Financial LLC bought a new position in USA Rare Earth during the 4th quarter worth approximately $832,000. Finally, Invesco Ltd. grew its position in USA Rare Earth by 25.2% during the 4th quarter. Invesco Ltd. now owns 67,592 shares of the company's stock worth $804,000 after acquiring an additional 13,598 shares during the last quarter.

About USA Rare Earth

USA Rare Earth NASDAQ: USAR is a development-stage critical minerals company focused on advancing a fully integrated rare earth element (REE) and lithium project in the United States. Its flagship asset is the Round Top deposit in West Texas, a large, polymetallic concentration of light and heavy rare earth elements, lithium and other co-products. The company seeks to move this asset through resource delineation, pilot-scale processing and eventual commercial production to address growing domestic demand for secure REE supply chains.

In addition to exploration, USA Rare Earth is engineering an on-site separation facility that will utilize dry magnetic separation and hydrometallurgical flowsheets to produce mixed rare earth carbonates.

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