Why Is USAR Stock Soaring Premarket? White House Reportedly Eyes 10% Stake

USA Rare Earth, Inc. (NASDAQ:USAR) stock surged more than 37% in premarket trading on Monday, January 26, 2026, following reports that the Trump administration is negotiating a massive $1.6 billion investment in the Oklahoma-based rare earths mining company. The deal, which would give the U.S. government a 10% equity stake in USA Rare Earth, represents the administration’s largest investment in the critical minerals sector to date and underscores the strategic importance of reducing American dependence on Chinese rare earth supplies.

The investment package includes both debt and equity components and will help fund the development of the company’s Round Top mine in Sierra Blanca, Texas, along with its magnet manufacturing facility in Stillwater, Oklahoma.

What We Know About the White House’s Proposed USAR Deal

According to sources familiar with the transaction, the Trump administration will receive 16.1 million shares in USA Rare Earth along with warrants for an additional 17.6 million shares as part of the investment package. Both the shares and warrants are priced at $17.17 each, near where the company’s stock traded earlier in January.

The deal, first reported by the Financial Times and confirmed by Reuters, is expected to be officially announced on Monday, with USA Rare Earth hosting a morning conference call with investors to discuss the terms.

The investment represents the latest in a series of strategic moves by the Trump administration to secure domestic production of critical minerals used in national defense, artificial intelligence, and advanced electronics.

A senior Trump official stated last month that the administration was planning more “historic deals” with the U.S. mining sector to boost production of lithium, rare earths, and other minerals essential to reducing dependence on foreign suppliers, particularly China. The deal follows similar equity stakes the administration took in MP Materials, Lithium Americas, and Trilogy Metals in 2025.

USA Rare Earth has retained Cantor Fitzgerald, a financial services firm chaired by Brandon Lutnick, the son of U.S. Secretary of Commerce Howard Lutnick, to assist with fundraising efforts. In addition to the government investment, the company is also securing a separate $1 billion private investment, bringing the total funding package to approximately $2.6 billion to accelerate development of its rare earth mining and processing operations.

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USAR Stock Performance and Company Developments

USA Rare Earth stock was trading at $33.97 in premarket on Monday at 5:51 AM EST, up $9.20 or 37.14% from its previous close of $24.77. The stock had already gained 40% week-over-week following the company’s announcement on Thursday that it had selected Fluor and WSP as its Engineering, Procurement, and Construction Management (EPCM) partners to advance the Definitive Feasibility Study for the Round Top project.

As of January 23, USAR had a market capitalization of approximately $3.45 billion and has delivered year-to-date returns of over 108%, significantly outperforming the S&P 500’s 1% gain.

The company is developing the Round Top Rare Earth Project in Sierra Blanca, Texas, in partnership with Texas Mineral Resources, with the mine slated to open by 2028. USA Rare Earth also operates a magnet manufacturing facility in Stillwater, Oklahoma, expected to launch production later this year, and a demonstration plant in Wheat Ridge, Colorado, which is planned to operate for at least 2,000 continuous hours with operations concluding in October 2026.

The company expects to conduct confirmatory and geotechnical drilling at Round Top in the first half of 2026, along with heap leach optimization studies to support mine design and engineering.

China currently dominates global rare earth processing, controlling production of the 17 minerals used in electronics, military equipment, electric vehicles, and smartphones. The U.S. produces only small volumes of rare earths, making the Trump administration’s push to increase domestic output a matter of national security and economic competitiveness.

Other rare earth stocks also rallied on the news, with MP Materials increasing 5.7% and Ramaco Resources rising 8.2% in premarket trading.

Disclaimer: The author does not hold or have a position in any securities discussed in the article. All stock prices were quoted at the time of writing.