Here's how to lower your risk when selecting rare-earth stocks to buy

By Philip van Doorn and James Rogers

A screen of 15 rare earth producers highlights seven for which analysts expect double-digit sales growth combined with rapid earnings-per-share increases

There may be a long runway for growing production and profits for producers of the 17 rare earth minerals.

Stocks of rare earth producers have been on fire this year, but we might still be at a very early growth stage for many players, especially those outside China.

You can invest alongside this growth trend through exchange-traded funds that hold rare-earth producers, but if you want to place concentrated bets with individual stocks, some are more speculative than others. Below we have screened rare earth companies for those showing a combination of projections for rapid sales growth and soaring earnings, or at least a swing to profitability, through 2027.

There are 17 different elements classified as rare-earth elements, or REEs. These include scandium, yttrium and the lanthanides, which account for 15 chemical elements in the periodic table. The elements range in crustal abundance from cerium, which is the 25th most abundant element of the 78 common elements in the Earth's crust, to thulium and lutetium, the least abundant rare earths, according to the U.S. Geological Survey.

Rare earths, which are used in a variety of industries, have been thrust into the spotlight in recent months after the Trump administration deemed them critical to U.S. national security. With trade tensions between the U.S. and China ongoing, the White House has been championing U.S. production of the elements, as evidenced by the stake the government has taken in rare-earths producer MP Materials Corp. (MP). China is by far the world's largest miner and producer of the elements.

Read: These rare-earth stocks may be the Trump administration's next buy targets.

In a report on Monday, a group of analysts led by Irene Tunkel, chief strategist at BCA Research, cited "a unique opportunity for non-Chinese miners and refiners to scale production and achieve profitability." This build-out will be "fraught with challenges," the analysts wrote, but they added that "government support materially improves the odds." They described themselves as "structurally bullish" on rare-earth production outside of China.

Screening rare earth producers' stocks

Analyzing rare-earth producers as a group is not as simple as sifting stock indexes for obvious rare-earth plays. This is because there is no specific category for "rare earths" in the data.

So we began our screen by looking at the holdings of five exchange-traded funds that invest at least some of their portfolios in rare earth stocks. They are listed here with REMX at the top, because of the ETF's name, with the remaining funds sorted by assets under management:

   ETF                                          Ticker   AUM ($mil)  Stock Holdings Date launched   Expense ratio  2025 total return through Oct. 27 
   VanEck Rare Earth and Strategic Metals ETF  REMX            $942              23  10/27/2010             0.58%                              78.5% 
   SPDR S&P Metals & Mining ETF                XME           $2,669              32   6/19/2006             0.35%                              72.2% 
   Global X Lithium & Battery Tech ETF         LIT           $1,299              38   7/22/2010             0.75%                              45.6% 
   Sprott Critical Materials ETF               SETM            $104              86   2/1/2023              0.65%                              71.7% 
   Amplify Lithium & Battery Technology ETF    BATT             $79              52   6/6/2018              0.59%                              53.4% 
                                                                                                                                        Source: LSEG 

The AUM column lists the assets under management, in millions, as of Sept. 30. The expense ratios are annual gross expenses as a percentage of assets under management. This means if your expense ratio is 0.65%, your annual fee for a $10,000 investment is $65. One caveat to the expense ratios on the table is that Van Eck Associates Corp. is limiting the expenses of the VanEck Rare Earth and Strategic Metals ETF REMX to 0.57% until at least May 1.

Total returns for these ETFs have been very high so far in 2025. They compare with a return of 17.9% for the SPDR S&P 500 ETF Trust SPY, which tracks the S&P 500 SPX with an annual expense ratio of 0.0945%. All returns in this article include reinvested dividends, if any.

Some notes about the ETFs:

-- The VanEck Rare Earth and Strategic Metals ETF tracks an index designed to hold companies that derive at least 50% of revenue from the rare-earth or strategic-metals industries. Not all strategic metals are considered to be rare-earth metals. This fund holds stocks of companies domiciled worldwide and can include Chinese companies with stocks listed in Hong Kong or on the mainland.

-- The SPDR S&P Metals & Mining ETF XME tracks an index of metals and mining-related stocks within the S&P Total Market Index, which itself encompasses the broad U.S.-listed stock market.

-- The Global X Lithium & Battery Tech ETF LIT tracks the Solactive Global Lithium Index, which is designed to encompass "companies throughout the lithium cycle, including mining, refinement and battery production," according to Global X Management Co. This means that LIT holds some stocks of electric-vehicle manufacturers, including Tesla Inc. TSLA, Rivian Automotive Inc. RIVN and Lucid Group Inc. LCID.

-- The Sprott Critical Materials ETF SETM is billed as "the only ETF to provide pure-play exposure to a range of critical materials and mining equities essential to meeting growing demand for energy generation, transmission and storage." It holds the largest number of stocks among the ETFs listed here.

-- The Amplify Lithium & Battery Technology ETF BATT tracks the EQM Lithium & Battery Technology Index. It holds the three U.S. EV makers held by LIT, but also holds Chinese EV manufacturers BYD Co. HK:1211, Li Auto Inc. LI and Nio Inc. NIO.

Together, these ETFs hold 172 stocks. A review of these combined holdings yielded a list of 15 rare-earth producers. Here they are, sorted by market capitalization in U.S. dollars. The data is presented in three tables. The first table includes year-to-date returns for the stocks and shows which ETFs hold each of the stocks.

   Company                                              Ticker   Country        Market cap (U.S. $mil)Held by 
   China Northern Rare Earth Group High-Tech Co Ltd.  CN:600111  China                         $27,063REMX 
   Jiangxi Copper Co. Ltd.                            HK:358     China                         $18,364BATT 
   Zhejiang Huayou Cobalt Co. Ltd.                    CN:603799  China                         $17,251BATT 
   MP Materials Corp.                                 MP         U.S.                          $12,538REMX, XME, SETM, BATT 
   Lynas Rare Earths Ltd.                             AU:LYC     Australia                     $12,042REMX, SETM 
   Tianqi Lithium Corp.                               HK:9696    China                         $11,208SETM, BATT 
   Sumitomo Metal Mining Co. Ltd.                     JP:5713    Japan                          $9,888BATT 
   Pilbara Minerals Ltd.                              AU:PLS     Australia                      $6,878REMX, LIT, SETM, BATT 
   Mineral Resources Ltd.                             AU:MIN     Australia                      $5,783LIT, BATT 
   IGO Ltd.                                           AU:IGO     Australia                      $2,796LIT, SETM 
   USA Rare Earth Inc.                                USAR       U.S.                           $2,430XME 
   Liontown Resources Ltd.                            AU:LTR     Australia                      $2,316REMX, LIT, SETM 
   Iluka Resources Ltd.                               AU:ILU     Australia                      $2,009REMX 
   AMG Critical Materials N.V.                        NL:AMG     Netherlands                    $1,102REMX, LIT 
   Vulcan Energy Resources Ltd.                       AU:VUL     Australia                        $968REMX, LIT, SETM 
                                                                                                                 Source: LSEG 

You might need to scroll the tables to see all of the data, or flip to landscape.

The second table includes sales and earnings-per-share compound annual growth rate (CAGR) projections from calendar 2025 through calendar 2027, based on consensus estimates among analysts polled by LSEG. The individual years' consensus EPS estimates (in local currencies where the stocks are listed) are in the right-most columns, so you can see if or when each company is expected to show full-year profits.

   Company                                               Ticker     Projected sales CAGR from 2025 through 2027  Projected EPS CAGR from 2025 through 2027  Est. 2025 EPS (Local)  Est. 2026 EPS (Local)  Est. 2027 EPS (Local) 
   China Northern Rare Earth Group High-Tech Co. Ltd.  CN:600111                                          15.8%                                      36.2%                   0.72                   1.03                   1.33 
   Jiangxi Copper Co. Ltd.                             HK:358                                              1.1%                                      11.3%                   2.28                   2.42                   2.82 
   Zhejiang Huayou Cobalt Co. Ltd.                     CN:603799                                          11.1%                                      16.8%                   3.33                   3.78                   4.54 
   MP Materials Corp.                                  MP                                                 75.0%                                        N/A                  -0.34                   0.86                   1.22 

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