Quick overview
- USA Rare Earth and The Metals Company saw a strong rebound in their stock prices following a broad market rally, driven by improved investor sentiment.
- Despite exceeding quarterly earnings expectations, USA Rare Earth faces a long path to profitability, with consistent net profits not anticipated until around 2028.
- The Metals Company continues to struggle with significant losses and remains in the pre-commercial phase of deep-sea mining, facing regulatory and financing challenges.
- Long-term strategic developments, such as securing rare-earth material sources outside China, support the investment thesis for both companies, despite near-term caution.
USA Rare Earth and The Metals Company rebounded alongside a broad market rally, though investors remain cautious as long paths to profitability continue to temper enthusiasm.
Rare Earth Stocks Join Broad Market Rebound
Shares of USA Rare Earth (USAR) and The Metals Company (TMC) rebounded strongly on Thursday after suffering steep declines over the previous two weeks, as improving market sentiment encouraged investors to return to higher-risk growth stocks. The recovery followed President Trump’s announcement of a peace agreement with Iran, a development later reported by Israel’s N12 as part of a broader regional arrangement that also includes Lebanon.
The announcement triggered a sharp rally across U.S. equities. The S&P 500 climbed approximately 1.3%, the Nasdaq Composite gained 1.8%, and the Russell 2000 advanced 2.4%, signaling renewed investor appetite for risk after weeks of heightened uncertainty.
USAR and TMC Recover After Heavy Profit-Taking
The broader market rally also benefited speculative mining and critical minerals stocks that had recently been under intense selling pressure.
USA Rare Earth rebounded from technical support near $20, rising roughly 11% after previously falling from resistance above $32. The Metals Company also recovered after declining toward the $4.80 level, climbing back above $5 as buyers returned to the sector.
The rebound follows a period of aggressive profit-taking as investors reassessed lofty valuations after the stocks’ strong multi-week advances.
Long Profitability Timeline Continues to Weigh
Despite USA Rare Earth delivering quarterly results that exceeded Wall Street expectations, investors remain focused on the company’s long road toward sustainable profitability.
Current analyst estimates suggest the company may not achieve consistent net profits until around 2028, while positive free cash flow is not expected until approximately 2029. Those extended timelines have prompted investors to become increasingly selective, particularly after recent rallies had already priced in a significant portion of future growth expectations.
The Metals Company faces similar challenges, with investors continuing to weigh its long-term strategic potential against the time and capital required to commercialize its projects.
Strategic Growth Story Remains Intact
While near-term sentiment has become more cautious, the longer-term investment thesis remains supported by strategic developments.
USA Rare Earth recently strengthened its position by securing access to rare-earth materials sourced outside China, an important milestone as Western economies continue working to diversify critical mineral supply chains. The company also announced a $2.8 billion agreement to acquire Serra Verde Group, expanding its mining and processing capabilities in Brazil.
Although Thursday’s rebound reflects renewed optimism across financial markets, investors are likely to remain focused on execution, funding requirements, and the lengthy timeline before these strategic investments translate into consistent earnings and cash flow.
USAR Chart Daily – Failing at the $32 Resistance Again
Those developments helped position the company as a potential strategic beneficiary of growing geopolitical efforts to diversify global critical mineral supplies. However, with those catalysts already reflected in the share price, the earnings report became an opportunity for investors to lock in gains rather than increase exposure.
USAR Q1 2026 Financial Highlights
- Earnings Per Share (EPS): Normalized (-$0.12) per share (GAAP EPS was (-$0.34).
- Revenue: ($5.70) million, comfortably beating the Street’s estimate of ($4.23) million.
- Key Milestones: The company successfully executed a ($1.5) billion PIPE financing and announced the consolidation of the Round Top project.
Deep-Sea Mining Story Faces Similar Pressure
The Metals Company also experienced renewed downside pressure following its latest earnings update. The company reported a first-quarter loss of $0.05 per share, broadly in line with expectations, but remains without revenue as it continues to operate as a pre-commercial deep-sea mining venture. Net losses reached $20.6 million for the quarter.
TMC Stock Daily – The 200 SMA Stopped the Run Higher
The company continues pursuing long-term opportunities tied to deep-sea mineral extraction, particularly for metals used in battery technologies and energy infrastructure. However, investors remain cautious about the enormous regulatory, environmental, and financing challenges surrounding the industry.
TMC Q1 2026 Financial Highlights
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- Net Loss: (-$20.5) to (-$20.6) million (flat compared to Q1 2025).
- Free Cash Flow: Improved to (-$0.6) million, up from (-$9.4) million in the prior-year period.
- Liquidity: Ended the quarter with ($119.7) million in cash and total available liquidity of ($164) million, including an undrawn credit facility.
Company Outlook & Milestones
- Management forecasts continued negative EPS as the company remains in the pre-revenue exploration and evaluation phase while awaiting commercial approval for deep-sea nodule harvesting.
- The company’s next earnings report is slated for August 13, 2026.
Skerdian Meta
Lead Analyst
Skerdian Meta Lead Analyst.
Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank’s local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.
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