Shares fall despite securing $1.55 billion in government-backed funding for a rare earth acquisition, as small-cap stocks face broader selling pressure.
USA Rare Earth (USAR) declined 5% to $18.26 in midday trading Monday, despite securing $1.55 billion in government-backed funding to finalize its Serra Verde acquisition. The drop follows a key merger condition being met, but broader small-cap risk rotation weighed on the stock.
United States Antimony (UAMY) fell 9% to $5.02 with no company-specific news, while MP Materials (MP) and Critical Metals (CRML) dropped 4% each. The VanEck Rare Earth ETF (REMX) slid just 2% to $79.38, signaling sector resilience amid selective profit-taking.
The divergence highlights a beta-driven selloff rather than a repricing of rare earth fundamentals. Serra Verde’s Pela Ema mine remains the sole non-Asian site producing all four magnetic rare earths, with over $1 billion already invested.