Is USAR a good stock to buy? We came across a bullish thesis on USA Rare Earth, Inc. on r/ValueInvesting by data-with-dada. In this article, we will summarize the bulls’ thesis on USAR. USA Rare Earth, Inc.’s share was trading at $22.58 as of April 20th.
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USA Rare Earth, Inc. engages in mining, processing, and supplying rare earths and other critical minerals in the United States. USAR is emerging as the only fully integrated U.S. company capable of producing rare earths end-to-end, from mining and processing to magnets, under one roof. This is significant given that China currently controls 85–90% of global rare earth processing, creating a chokehold over defense, EV, and semiconductor supply chains. USAR’s Phase 1a facility at Stillwater is already operational, delivering product and transitioning the story from speculative to tangible revenue generation.
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Its Round Top project covers both light and heavy rare earths, positioning the company to supply critical materials for both defense and clean energy applications, with a total addressable market that is substantial and largely untapped outside of China. With 94% of permanent magnets sourced from China and no scalable alternatives, USAR is effectively the U.S. backup plan, and its strategic value rises every time trade tensions escalate or Chinese exports are delayed.
The company is actively building an offtake pipeline, accelerating its revenue story, and establishing itself as a national security asset rather than a traditional mining play. Unlike commodity-focused companies, USAR’s infrastructure is critical to U.S. supply chain independence, attracting potential government support.
Financially, the company is well-positioned, with $1.2 billion in cash and zero debt, making the current stock price of $15.92 highly attractive. Given its operational progress, strategic importance, and cash position, USAR presents a compelling risk/reward opportunity, with upside potential that could double the stock as the market recognizes its unique role in domestic rare earth supply and national security.
Previously, we covered a bullish thesis on MP Materials Corp. (MP) by Steve_Zissouu in April 2025, which highlighted the company’s end-to-end rare earth mining and processing in the U.S., cessation of shipments to China, and alignment with government initiatives to secure domestic critical minerals. MP’s stock price has appreciated by approximately 185.59% since our coverage. data-with-dada shares a similar view but emphasizes USAR’s fully integrated rare earth infrastructure, operational Phase 1a facility, and strategic importance as a U.S. national security backup plan.
USA Rare Earth, Inc. is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 23 hedge fund portfolios held USAR at the end of the fourth quarter which was 30 in the previous quarter. While we acknowledge the risk and potential of USAR as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than USAR and that has 10,000% upside potential, check out our report about this cheapest AI stock.
Disclosure: None.
