MP's Materials Segment 1H26 Revenues Jump 80%: Can This Momentum Last?

MP Materials MP is gaining momentum in 2026 as its efforts to expand neodymium-praseodymium (NdPr) production translate into stronger operational performance, higher revenues and improved profitability in its Materials segment.

The Materials segment represents the upstream and midstream operations of the company, anchored by Mountain Pass, its fully integrated mining and refining facility producing refined rare earth oxides and related products. The segment now derives its revenues from NdPr oxide and metal sales, reflecting MP Materials’ strategic shift toward higher-value products. 

Historically, rare earth concentrate sales accounted for the bulk of segment revenues. However, after halting shipments to Chinese customers in July 2025, the company began processing the concentrate into separated rare earth products or stockpiling it for future use.

NdPr production was a record 917 metric tons in the first quarter of 2026, followed by 840 metric tons in the second quarter. This brings the total NdPr production for the first half of 2026 to 1,757 metric tons, up 51% year over year. NdPr sales volumes surged 122% to 2,012 metric tons during the period. The company also produced 24,055 MT of rare earth oxides (REO) in concentrate in the first half of 2026.

This robust production and sales growth boosted the Materials segment’s financial performance. First-half revenues increased 80% year over year to $167.8 million, supported by higher sales volumes and stronger market pricing.

The Materials segment reported adjusted EBITDA of $69.2 million in the first half of 2026, a turnaround from the loss of $8.9 million reported in the first half of 2025. This was attributed to higher revenues and Price Protection Agreement (PPA) income of $59.8 million related to the agreement with the Department of War (DoW), despite higher cost of sales.

The performance so far this year builds on the momentum established in 2025. During the year, the segment sold 1,994 metric tons of NdPr, up 75% year over year. The Mountain Pass operations produced a record 2,599 MT of NdPr in 2025, more than double the 1,294 MT produced in 2024. 

Australia-based peer Lynas Rare Earths Limited LYSDY reported NdPr production of 1,857 tons for fourth-quarter fiscal 2026 (ended June 30, 2026), down 11% year over year. The company also produced 19 tons of dysprosium and terbium during the quarter. Total REO production reached 3,481 tons, up 8% from the prior-year quarter. The company also announced its first production of samarium oxide in March 2026.

Lynas’ revenues jumped 70% year over year to AUD 288.9 million ($204.9 million), marking the company’s highest quarterly revenues since the fourth quarter of fiscal 2022. Growth was driven by higher NdPr prices and increased sales volumes of total REO products. 

MP’s Price Performance, Valuation & Estimates

MP Materials’ shares have declined 21.7% in a year compared with the industry’s 49.8% growth. Peers Lynas Rare Earths and Energy Fuels Inc. UUUU have gained 30% and 66.2%, respectively. 

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MP is trading at a forward 12-month price/sales multiple of 15.29X, a significant premium to the industry’s 1.42X. Energy Fuels and Lynas Rare Earths are trading at 19.27X and 10.34X, respectively. 

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The Zacks Consensus Estimate for MP Materials’ 2026 revenues indicates a 102% increase year over year. The consensus estimate for 2026 earnings is currently pegged at 12 cents per share, suggesting a solid improvement from the loss of 24 cents reported in 2025. 

The consensus estimate for MP’s 2027 revenues suggests year-over-year growth of 72%, with earnings expected to surge 658%.

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The estimate for both 2026 and 2027 has, however, moved down in the past 60 days, as shown in the chart below.

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The company currently carries a Zacks Rank #3 (Hold).

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This article originally published on Zacks Investment Research (zacks.com).

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