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Investing.com - Jefferies upgraded MP Materials (NYSE:MP) from Hold to Buy and more than doubled its price target to $80.00 from $33.00. The stock, currently trading at $61.50 with a market capitalization of $10.9 billion, has shown remarkable momentum with a 180% surge over the past six months. According to InvestingPro analysis, the stock appears overvalued at current levels.
The upgrade follows what Jefferies described as "transformational deals" with the Department of Defense and Apple (NASDAQ:AAPL), which have supported the rare earth materials company’s scale and validated its capabilities.
MP Materials shares have approximately doubled in value following these strategic partnerships, according to Jefferies’ analysis.
The investment firm expects additional OEM off-take agreements to materialize in the second half of 2025 and into 2026, potentially increasing the company’s strategic value.
Jefferies also highlighted potential catalysts including the Saudi joint venture, which it assigns a 90% probability of delivering material technology value, a possible European Union project, and the positive impact expected from interest rate cuts.
In other recent news, MP Materials has announced the pricing of an upsized public offering of common stock at $55 per share, aiming to raise approximately $650 million. The company plans to sell 11,818,181 shares, with an option for underwriters to purchase up to an additional 1,772,727 shares to cover over-allotments. Additionally, MP Materials has launched a $500 million underwritten public offering of its common stock, with J.P. Morgan Securities LLC, Goldman Sachs & Co. LLC, and Morgan Stanley (NYSE:MS) & Co. LLC acting as book-running managers.
In related developments, JPMorgan has increased its price target for MP Materials to $64, up from $18, following a significant agreement with the Department of Defense. This upgrade reflects a substantial 255% increase, attributed to the company’s promising deal with the DoD. Meanwhile, Morgan Stanley has resumed coverage of MP Materials with an Equalweight rating and a price target of $65, noting significant changes to the company’s business model. These developments highlight the dynamic changes and strategic partnerships influencing MP Materials’ market position.
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