MP Materials heads into its June 9 earnings call with a striking contradiction at its core: the stock is up 8% on the month and shorts are trimming positions — yet the founder-CEO has been selling aggressively into the rally and the borrow market is now fully seized up.
The most jarring signal this week is in the lending market. Availability has collapsed to just 2.1% — meaning for every share currently shorted, barely one additional share remains available to borrow. That is near the lowest reading of the past 52 weeks, which hit 0.14%. For most of May, availability oscillated between 0.4% and 27%, but the pattern has tightened sharply since late May. With the lending pool effectively exhausted, any fresh attempt to build a short position faces a hard ceiling on supply. Cost to borrow, at 1.09% annualised, has risen 13% over the past week and 16% over the past month — still not punishing in absolute terms, but the direction is consistent with the squeeze on inventory.
Short interest itself, at 15.2% of free float, remains one of the higher readings in the materials universe — and the ORTEX short score of 72.6 ranks in the first percentile of the entire market for short positioning intensity. Yet shorts have been easing, not building. Shares short fell nearly 4% on Tuesday alone and are down 1.5% on the week, even as they remain 5.6% above levels from a month ago. The pattern is one of partial retreat: bears built positions through early-to-mid May, and the recent stock rally has prompted some unwinding. Options traders are not reading this as a squeeze setup. The put/call ratio is 0.48, effectively flat relative to its 20-day average of 0.48, near the lowest reading of the past year — call interest dominates, not hedging demand.
The street is firmly in the bull camp. Needham initiated coverage on June 1 with a Buy and an $81 target, following Barclays' Overweight initiation at $69 on May 22. Morgan Stanley raised its Overweight target to $70 from $62 in May. Wedbush is the most bullish, at $100 after lifting its target from $90. Consensus sits at a buy with a mean target of $80.44, roughly 11% above the current $72.24 price. The bull case centres on MP as the only scaled US rare-earth producer at a time when the Pentagon's 2027 magnet-supply deadline is forcing domestic sourcing. Bears counter that the company still generates a reported net loss, trades at 111x trailing earnings and 45x EV/EBITDA, and is in the middle of a capital-intensive production ramp that consumed $547m in capex last year against only $71m of operating cash flow. EPS momentum scores rank in the 70th–84th percentile, suggesting estimates are rising — but from a loss base.
The ownership data adds texture. Founder James Litinsky sold approximately 400,000 shares across May 27–29, collecting roughly $16m in proceeds at prices between $64 and $68 — well below where the stock closed this week at $72.24. That selling continued even as the stock was already rallying, and his total holding now reflects a $1m reduction per the most recent institutional filing. Against that, co-founder and COO Michael Rosenthal purchased 17,000 shares on May 20 at $56.62 — a buy of just under $1m that preceded the bulk of the recent move. Rosenthal's purchase sits as an isolated bullish signal inside a broader pattern of net selling. Institutional flows elsewhere are broadly positive: BlackRock added 1.27m shares through April, Van Eck added 1.75m, and D.E. Shaw built a new 2.5m-share position.
Peer performance this week supports the rare-earth momentum theme but with an important caveat. LAC gained 15% and UAMY climbed 15.7%, broadly in line with MP's 7.8% weekly gain. The sector is moving together on geopolitical tailwinds, which limits how much of MP's rally can be attributed to stock-specific factors. Last time the May earnings print landed, the stock fell 7.2% on the day and extended losses to -17% over the following five sessions — context worth holding alongside the current bullish consensus heading into June 9.
The June 9 earnings call is therefore the immediate focal point: whether Litinsky's recent selling reflects routine portfolio management or something about the near-term outlook, and whether the nearly-exhausted borrow market creates additional sensitivity if the print disappoints.
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