Key Points
USA Rare Earth reported Q4 2026 financial results before the market opened today.
Roth Capital reduced its price target on USA Rare Earth stock.
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After falling more than 5% last week, USA Rare Earth (NASDAQ: USAR) stock plummeted today, ending the trading session down 7% from Friday's close.
In addition to the company's disappointing fourth-quarter 2025 financial results, which were announced this morning before the bell, a firm's less optimistic outlook on the rare-earth stock prompted investors to click the sell button.
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A greater-than-expected net loss last quarter was just one reason for investors' unhappiness
Failing to meet analysts' expectations that it would post a loss per share of $0.14, USA Rare Earth reported an adjusted diluted loss per share of $0.19. Those looking at the company's performance in 2025, moreover, were likely dismayed to find that it reported a steeper loss -- adjusted diluted earnings per share (EPS) of negative $0.82 -- than the negative $0.40 it reported in 2024.
Later in the day, after the company posted financial results, Thefly.com reported that Roth Capital reduced its price target on USA Rare Earth stock to $25 from $35, maintaining its buy rating. Instead of attributing it to any of the company's reported metrics, Roth Capital based the downwardly revised price target on updated market valuations.
What's a rare-earth investor to do now?
Investors may have been dismayed to find the company failing to meet expectations at the bottom of the income statement and further disheartened to learn of the lower price target, but trimming one's position based solely on these factors seems rash.
USA Rare Earth anticipates commissioning the hydrometallurgical demonstration facility in Colorado in the second quarter of 2026 and completing the Round Top Preliminary Feasibility Study by the end of Q3 2026. Should the company fail to achieve these targets, it could signal that its expectation of starting commercial production at Round Top in late 2028 is in jeopardy -- something of greater material concern to investors interested in mining stocks.
Should you buy stock in USA Rare Earth right now?
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Scott Levine has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
