U.S. Rare Earths 'Strategic National Stock' Plummets Over 6%: Are Short-Term Overheating Warnings On?

On the 10th, shares of U.S. rare earth developer USA Rare Earth Inc. (NASDAQ: USAR) closed at $21.90 on the Nasdaq, down 6.53% from the previous day, with trading volume topping 6.84 million shares.

The company’s market capitalization slipped to about $3.2 billion (roughly KRW 4.3 trillion), erasing around $200 million (approximately KRW 270 billion) in a single day.

On January 25, USA Rare Earth signed a non-binding letter of intent (LOI) with the U.S. government for up to $1.6 billion (about KRW 2.1 trillion) in loans and equity investment. Just four days later, on January 29, insiders reportedly boosted their positions by purchasing roughly $2.17 million (around KRW 3 billion) worth of stock. (globenewswire.com)

More recently, analysts note that the company has significantly expanded its investment capacity in its Texas Round Top mine and Oklahoma magnet plant by raising about $3.0 billion (approximately KRW 4 trillion) in the capital markets. (fool.com)

Founded in 2019, USA Rare Earth is a U.S.-based rare earth and magnet specialist pursuing vertical integration “from mine to magnet.” Its operations include the Round Top heavy rare earth mine in Texas and the Steelwater neodymium permanent magnet plant in Oklahoma. (en.wikipedia.org)

With China controlling the lion’s share of global rare earth supply, USA Rare Earth has emerged as a prime beneficiary of the U.S. government’s strategy to de-risk its supply chain from China, especially for critical materials in defense, electric vehicles, and renewable energy. (apnews.com)