Texas Capital Securities Initiates USA Rare Earth Coverage

The firm sets a $28 price target for the company as it develops manufacturing facilities in South Carolina.

Updated on Oct. 22, 2026 in Corporate Finance

Isometric editorial illustration of refined rare earth magnet components resting on a steel plate. — Texas Capital Securities has initiated coverage of USA Rare Earth with a buy rating and a $28 price target. AI Illustration. Upload story photo >

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Texas Capital Securities has initiated stock coverage of USA Rare Earth with a Buy rating and a $28 price target. The firm is currently moving toward metal and magnet production at its new facility in Blacksburg, South Carolina.

Why it matters

This analyst coverage arrives as the company balances long-term development of its Round Top project in Texas with the construction of a new manufacturing hub. The company relies on federal support agreements to fund these capital-intensive industrial goals.

The Commerce Department agreements provide a $277 million cap on direct awards and guarantee up to $1.3 billion in Federal Financing Bank advances. Metal-making operations currently serve as the company's sole source of revenue.

The players

Texas Capital Securities

An investment firm that has initiated financial coverage and valuation analysis of the company.

USA Rare Earth

A company focused on developing domestic rare earth mineral production and associated magnet manufacturing.

The details

While the company holds significant federal backing, its primary Round Top site in Texas remained in the exploration stage as of June 30. The firm recently broke ground on its South Carolina facility, which is expected to begin commissioning in 2028.

June 30, 2026: Round Top project remained in the exploration stage.
September 9, 2026: Ground was broken for the Blacksburg facility.
2028: Targeted commissioning date for the South Carolina facility.

Market Dynamics

This move highlights the ongoing effort to build a domestic supply chain for magnets and minerals, following the pattern set by federal support protocols designed to secure critical materials. It represents a pivot toward scaling operations to compete with established global suppliers.

Retail investors should note that the company remains in a developmental phase with its primary mining projects and is not yet generating revenue from mineral production. The stock valuation is currently tied to federal financial guarantees rather than existing operational cash flow.

The takeaway

The company is transitioning from an exploration-focused business to a manufacturing entity supported by federal agreements. Investors should monitor the progress of the South Carolina commissioning schedule as a key milestone for future performance.