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Investing.com - JPMorgan has significantly increased its price target on MP Materials (NYSE:MP) to $64.00 from $18.00 while maintaining a Neutral rating, citing the company’s recent landmark deal with the Department of Defense. According to InvestingPro data, the stock is currently trading near its 52-week high of $64.51, with a notably high beta of 2.26 indicating significant price volatility.
The substantial 255% price target increase follows MP Materials’ stock surge of approximately 210% since announcing the DoD agreement, outperforming both the S&P Metals & Mining ETF and S&P 500, which gained about 10% and 7% respectively during the same period.
JPMorgan notes that MP Materials’ visibility has been further enhanced by its newly disclosed partnership with Apple (NASDAQ:AAPL) and a successful public offering that raised approximately $725 million, giving the company what the firm describes as "the best visibility of any company in our overall coverage universe."
The investment bank has adjusted its valuation model for MP Materials, applying a premium EV/EBITDA multiple of 30x (up from 20x previously), which exceeds the average multiple for companies with significant defense and national security exposure.
Despite the substantial price target increase, JPMorgan maintains its Neutral stance, suggesting that while additional offtake agreements could drive further multiple expansion, the current valuation largely reflects the improved risk/reward profile, with profitability expected to be somewhat capped over the next two years due to NdPr pricing constraints. InvestingPro analysis indicates the stock is currently overvalued, with additional metrics and 17 exclusive ProTips available to subscribers, including crucial insights about the company’s profitability outlook and valuation multiples.
In other recent news, MP Materials Corp. has announced the pricing of an upsized public offering of common stock at $55 per share, with expected gross proceeds of approximately $650 million. The company plans to use the proceeds to accelerate and expand its operations, including its 10X Facility, and for strategic growth opportunities. J.P. Morgan Securities LLC and Goldman Sachs & Co. LLC are leading the offering, which is expected to close on July 18, 2025. Additionally, MP Materials has launched a $500 million underwritten public stock offering, with underwriters granted a 30-day option to purchase additional shares to cover over-allotments.
In related developments, DA Davidson reiterated its Buy rating and $32.00 price target for MP Materials following a new partnership with Apple, which includes a $200 million prepayment for rare earth magnets. Canaccord Genuity raised its price target for the company to $64.00, maintaining a Buy rating due to anticipated demand from Apple and other clients. The firm estimates that Apple’s demand could generate over $90 million in revenue for MP Materials. These partnerships and financial moves underscore MP Materials’ continued expansion in the rare earth materials sector.
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