Follow along for our top picks for the best rare earth stocks.
Rare earth metals are essential for developing many high-tech and industrial products.
These products appear in personal computers, flat-screen TVs, and electric vehicles.
Historically, China has been the largest producer of rare-earth metals, but several other countries have increased production in recent years.
Now that there are more big players in the industry, you have more choices than ever to invest in.
But which rare earth stocks should be on your radar?
Keep reading to find out.
Best Rare Earth Stocks To Buy
MP Materials (NYSE: MP)
MP Materials is a rare earth venture in Las Vegas, Nevada.
This company is significant because it owns the Mountain Pass Mine in San Bernardino County, California, which is the only operating integrated rare earth mining site and processor in the United States.
This stock was formed when a particular purpose acquisition company (SPAC) purchased the Mountain Pass Mine and related assets in 2017.
MP Materials went public just under two years ago.
In 2019 and 2020, the Mountain Pass Mine produced approximately 15 percent of the world’s rare earth elements.
Financially, MP Materials consistently beats its revenue and earnings per share estimates and sees massive gains in net income.
Something to keep in mind is that there have been some reports that the Biden administration could impose tariffs on Chinese rare earth metals in the future.
As the only rare earth mining and processing operation in the US, this could be hugely beneficial for MP Materials.
By the end of 2021, the value of MP Materials stock peaked in value until it stabilized back to a more reasonable level by around February 2022.
The company will be looking to show strength as it approaches its next earnings release, which is expected to be around the end of February.
Projections are positive for the company, with a potential 16.67% growth in earnings YoY.
Even with the lack of real catalyst before its financial report, the company could continue to stay consistently strong due to its position as one of the few “true” rare-earth metal mining companies outside China.
The US will need access to a supply of rare earth resources regardless of our relationship with China and other countries.
This makes MP Materials a potentially smart pick moving forward.
VanEck Vectors Rare Earth/Strategic Metals ETF (NYSE: REMX)
This investment isn’t actually a stock — it’s an exchange-traded fund that contains many of the world’s top rare earth companies.
REMX has rare earth companies from China and many other parts of the world.
An ETF is generally viewed as a relatively low-risk investment in the long term because it contains many different stocks.
Generally speaking, this makes it not nearly as volatile as investing in one individual stock.
That being said, no investment comes with zero risk.
While it isn’t a rare earth pure play, it could still be an excellent way to put some rare earth exposure into your portfolio.
This ETF also contains other metals in very high demand right now, like cobalt and lithium.
There has been a lot of hype among investors about rare earth this year, and this ETF could perform exceptionally well as a result.
After a slight dip in September, REMX has bounced back to reach year-long highs.
Because the success of these companies is so heavily affected by global politics, it’s hard to know exactly what will happen.
So far, VanEck’s Rare Earths experienced a slight dip again around the end of January, especially with China starting to position itself with Russia against the US and NATO.
This makes the position of VanEck problematic, but rare earth companies in China would still need to sell outside the country if it wants to continue being profitable.
Regardless, the ETF recovered and is close to its Holiday 2021 numbers, but the lack of catalysts, makes the value of this ETF lag behind.
Lynas Rare Earths Ltd. (OTC: LYSCF)
Lynas Rare Earths is one of the biggest rare earth production enterprises not based in China.
The company is headquartered in Australia, with a mine in Western Australia and a refining facility in Malaysia.
To become even more efficient, it has also started a project to build a rare earths processing facility in Western Australia near its mine.
Lynas produces a variety of rare minerals, most notably neodymium, which is used in magnets.
The company has opened itself up to potential deals with the US and other countries by operating outside of China.
In fact, Lynas looks to partner with American processor manufacturer Blue Line Corp to build a separation facility in Texas.
This project is funded by the Department of Defense and could provide a substantial income stream.
Lynas’s stock performed very well in 2021, with 125% growth compared to the previous year.
If Lynas Rare Earths continues to make lucrative deals with the United States and other nations, it could see even more growth.
Materion Corporation (NYSE: MTRN)
Materion Corporation is a USA rare earth company that produces advanced engineering materials.
These materials are made from rare earth products and include precious and non-precious metals, alloys, ceramics, inorganic chemicals, and more.
This company is exciting due to its broad range of industries, including defense, semiconductors, auto industry, consumer electronics, energy, and more.
Although Materion does not mine for rare earth itself, it serves as an essential middle step in production.
With a very steady stream of business in various industries, it has also pivoted during tricky economic times.
Materion has recently acquired a portfolio of electronic materials from leading provider H.C. Starck.
This is particularly helpful right now, as Materion can sell these materials to semiconductor manufacturers.
The world is still expecting a shortage of semiconductors due to high demand and supply chain issues.
In addition, Materion subsidiary Brush Wellman has consistent government contracts because of its beryllium supply.
Materion’s third-quarter earnings report handily beat analysts’ expectations.
The company has solid momentum, mostly due to its clean financials.
With a relatively small amount of debt, Materion seems set up financially for the future.
Ready to build your portfolio? With Public.com you can follow other investors, discover companies that are inline with your beliefs, and invest into stocks and crypto with very little money! What are you waiting for? Check out Public Now!
Top Rare Earth Stocks To Buy
Neo Performance Materials (OTC: NOPMF)
Neo Performance Materials is a global rare earth venture based in Toronto, Canada.
The manufacturer has a processing facility in Estonia with manufacturing facilities in countries around the world.
This diversity has allowed Neo to have a huge portfolio of innovative products and technology.
It is mainly well known for its magnets and magnetic powders, making a wide range of rare metal and chemical products.
Thanks to this sizable portfolio of products, the company has exposure to an extensive array of industries.
Neo’s most recent earnings report was solid, with considerable gains in revenue, earnings per share, and net income.
Revenue was up over 53 percent year over year, and Neo maintained a significant cash reserve of over $51 million.
Neo’s stock also performed very well this year, over 60% up from last year at this time.
Iluka Resources (OTCMKTS: ILKAF)
Iluka is a leading international mineral sands company involved in exploration, development, mining, processing, marketing, and rehabilitation.
Iluka has been in the zircon industry for over 60 years and is a leading global producer of zircon and titanium dioxide feedstocks, rutile, and synthetic rutile.
Furthermore, Iluka is developing its rare earth element portfolio.
The company has operations in Australia, Sierra Leone, and Sri Lanka as well as a global marketing and distribution network.
Iluka is having a solid year, with a record-breaking 2021 after a sharp slump in October 2020.
The company had a considerable 10% jump from 2022, and we could see this momentum continue throughout the year.
Should You Buy Rare Earth Stocks?
Rare earth stocks could be an excellent option if you’re looking for an industry that is seeing a steady spike in demand.
Global demand for these materials has increased significantly over the last few years.
In particular, the electric car industry is taking off, as consumers are looking for eco-friendly transportation options.
Since electric cars require rare earth elements for production, these companies could benefit heavily from the increased demand for these cars.
Rare earth elements are also used in various other essential items, ranging from personal electronics to defense systems.
This gives rare earths companies a wide variety of potential buyers in different industries.
Also, having multiple revenue streams can somewhat insulate these companies from the ups and downs of the market, which could make them a better long-term investment.
Demand doesn’t seem to be slowing down anytime soon, so you might want to keep rare earth metals on your radar.
Where to Buy Rare Earth Stocks
Well-established rare earth stocks are often listed on major exchanges like the NYSE and NASDAQ.
Startups and those without anything yet to show for their work are typically found on OTC markets.
If you want to search the major exchanges, we recommend Robinhood or Webull.
Robinhood provides an easy-to-understand user interface that new or experienced traders can navigate quickly.
Webull has complex tools at your disposal for those wanting more comprehensive searches.
If the lower-priced startups speak more to you, brokers like Fidelity offer the means to do so at no cost per trade.
Rare Earth Stocks: Final Thoughts
If you want to invest in the growing electric vehicle industry but aren’t quite ready to buy into risky startup manufacturers, buying rare earth stocks could be a good option instead.
Many of these companies already have their feet on the ground and products out the door.
Since rare earth materials are part of so many essential products right now, demand could continue to rise to new heights.
That being said, you should perform your own due diligence before picking up any stocks, including the ones on our list.
Rare Earth Stocks FAQ
Follow along for our answers to the most commonly asked questions about rare earth stocks.
What Are Rare Earth Stocks?
Rare earth stocks are stocks for companies that mine, process, and sell rare earth minerals.
This also includes supporting services, such as:
- Rare earth exports
- Rare earth supply chain
- Rare earth reserves
- And more
Their materials are commonly used for tech products and other renewables.
Who Owns Most Rare Earth Minerals?
It is estimated that China mines about 70% of the world’s rare earth minerals, while it also carries out 90% of the complex process of converting them into magnets.
According to a recent White House report, China controls 55% of the world’s rare-earth mining and 85% of the world’s refining industries.
Is Rare Earth A Good Investment?
The rare earth space could be a solid investment if you want to add a relatively stable industry that has long-term applications.
Most companies who handle these products are either in China, US, or Australia, with a sufficient supply for the world’s demand.
Their applications with EV technology is another reason some investors are bullish on rare earth stocks.
What Countries Have Rare Earth Minerals Outside Of China?
The United States and Australia all have rare earth minerals.
While other countries have limited amounts, China still holds the most considerable bulk of mineable rare earth minerals, including molybdenum and lithium.
What Is The Best Rare Earth Stock?
Our top pick to watch out for is MP Materials.
It is the biggest provider of rare earth minerals outside China, giving them consistent value as a go-to resource.
Also, its stock trades on the NYSE, which is good for US investors.