This Stock Is Up Over 300% in 2025 -- and You May Have Never Heard of It

Key Points

• MP Materials is the best-performing large-cap stock of the year so far.

• Its big catalyst was a major deal with the U.S. government announced in July.

• The stock offers a unique value proposition that many investors will probably like.

• 10 stocks we like better than MP Materials ›

Skyrocketing stocks tend to attract plenty of attention from investors. Think Palantir Technologies or Robinhood Markets, both of which have more than doubled this year.

But another stock has been an even bigger winner. This stock is up over 300% in 2025 -- and you may have never heard of it.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Image source: Getty Images.

MP who?

MP Materials (NYSE: MP) has delivered a year-to-date return of 308% as of the market close on Aug. 1, 2025. That's the best performance of any large-cap stock, although MP Materials didn't start the year with a market cap over $10 billion.

What does MP Materials do? The Nevada-based company is the largest producer of rare-earth materials in the Western hemisphere. It's also the only fully integrated rare-earth producer whose operations cover the entire supply chain, from mining to manufacturing.

The "MP" in MP Materials' name stands for Mountain Pass. Located in San Bernardino County in California, Mountain Pass is home to the only large-scale rare-earth mining and processing site in North America. MP Materials' efforts aren't limited to this one location, though. It's also developing a manufacturing facility in Fort Worth, Texas.

The rare-earth materials mined and processed by MP Materials are used to make the strongest magnets in the world. These magnets are critical components in electric motors and generators that power drones, electric vehicles, hybrid vehicles, robotics, wind turbines, and more.

Why this rare-earth materials stock has skyrocketed

MP Materials was founded in 2017 to restart operations at Mountain Pass that had been idle for two years. The company listed its shares on the New York Stock Exchange in 2020. The stock quickly took off, more than quadrupling by early 2022.

That initial momentum eventually fizzled. MP Materials stock languished throughout much of the next three years. Shares began bouncing back in late 2024 and continued to climb during the first few months of 2025. The initiation of production at the company's Fort Worth facility in January helped spark investors' interest.

However, the big story for MP Materials came on July 10. The company announced that the U.S. Department of Defense (DoD) was investing in it and would become its largest shareholder. The DoD also committed to setting a price floor of $110 per kilogram for MP Materials' neodymium-praseodymium rare-earth products for the next 10 years.

In addition, the company revealed plans to construct a new U.S. magnet manufacturing facility, with the DoD agreeing to ensure that all magnets produced at the facility will be bought by commercial and defense customers. MP Materials also expects to boost its heavy rare earth separation capabilities at its Mountain Pass facility.

Is MP Materials stock a buy now?

Investors have a lot to like about MP Materials. The company is now backed by Uncle Sam. Even when a new president is in the White House, producing rare earth materials domestically will be a top priority -- and MP Materials is the only company that can do it.

Are there any things that investors shouldn't like about this stock? Perhaps its valuation. MP Materials' shares trade at a forward price-to-earnings ratio of 24.1. That's higher than the S&P 500's forward earnings multiple of 22.6 and the S&P 500 materials sector's multiple of 20.

However, I don't think MP Materials' valuation is concerning when you consider the big picture. Few companies have guarantees that the products they produce will be bought, but MP Materials does -- at least the products produced at its planned second facility. Most businesses don't know for sure if their prices might be undercut by rivals. But MP Materials has a pricing floor that will be enforced by the U.S. government.

I wouldn't count on MP Materials continuing to deliver the staggering returns we've seen in recent months. If you're looking for a relatively low-risk stock that not every investor knows about, though, this could be it.

Should you invest $1,000 in MP Materials right now?

Before you buy stock in MP Materials, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and MP Materials wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $624,823!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,064,820!*

Now, it’s worth noting Stock Advisor’s total average return is 1,019% — a market-crushing outperformance compared to 178% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of July 29, 2025

Keith Speights has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Palantir Technologies. The Motley Fool recommends MP Materials. The Motley Fool has a disclosure policy.