USA Rare Earth, Inc. (NASDAQ:USAR) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. USA Rare Earth, Inc. engages in mining, processing, and supplying rare earths and other critical minerals. The company’s loss has recently broadened since it announced a US$13m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$22m, moving it further away from breakeven. Many investors are wondering about the rate at which USA Rare Earth will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.

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According to some industry analysts covering USA Rare Earth, breakeven is near. They anticipate the company to incur a final loss in 2026, before generating positive profits of US$16m in 2027. The company is therefore projected to breakeven around 2 years from today. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 61% is expected, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won’t go into details of USA Rare Earth's upcoming projects, however, keep in mind that typically a metal and mining business has lumpy cash flows which are contingent on the natural resource mined and stage at which the company is operating. So, a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Check out our latest analysis for USA Rare Earth

One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 1.3% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of USA Rare Earth which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at USA Rare Earth, take a look at USA Rare Earth's company page on Simply Wall St. We've also compiled a list of relevant aspects you should look at:

1. Historical Track Record: What has USA Rare Earth's performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on USA Rare Earth's board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.