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MP Materials Backed By $110 DoD Price Floor As JPMorgan Sees 33% Upside

MP Materials Backed By $110 DoD Price Floor As JPMorgan Sees 33% Upside

FinvizFinviz2026/02/13 18:03
By:Finviz

Rare earths are political again. And that's exactly why MP Materials Corp (NYSE:MP) may have one of the most unusual earnings setups in mining: a government-backed floor with upside still intact.

Ahead of fourth-quarter results, JPMorgan Chase analyst Bill Peterson reiterated his Overweight rating and lifted his price target to $76 — implying roughly 33% upside from recent levels. His core argument? Visibility.

$110 DoD Price Floor Anchors Earnings

Peterson points to MP's Department of Defense agreement, which effectively sets a $110/kg price floor for NdPr (Neodymium-Praseodymium — a combined rare earth product) beginning Oct. 1. With NdPr prices rebounding and national security concerns around rare earths "here to stay," he views the deal as ironclad protection in a volatile commodity environment.

If prices remain above that level, MP keeps the full upside until its 10X magnet facility reaches capacity later this decade. In Peterson's view, that creates asymmetric risk-reward — downside protection with leverage to higher pricing.

Magnet Ramp And Midstream Growth In Focus

The near-term quarter may look seasonally quiet, but Peterson says investors are focused on confidence in midstream NdPr production and the initial commercial magnet ramp targeted for 2H26.

He expects EBITDA to turn positive again in the fourth quarter as DoD top-off payments begin, even if free cash flow remains pressured by capex and inventory build. Longer term, he models an EBITDA floor near $650 million once 10X is fully ramped.

Why It Matters

MP shares have recovered this year as NdPr prices climb, but volatility remains elevated amid trade-policy headlines and retail participation. Peterson's thesis is simpler: rare earth security isn't cyclical — it's structural.

With a government price backstop and magnets scaling, MP isn't just mining rock. It's building a strategic franchise.

Photo: Shutterstock

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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