USA Rare Earth Inc. (NASDAQ:USAR) shares surged 5.18% in intraday trading, rebounding strongly after an initial drop following the company's disappointing third-quarter earnings report. The stock's recovery appears to be driven by positive analyst sentiment and raised price targets.

Earlier in the day, USAR shares had fallen as much as 9.6% in pre-market trading after the company reported a wider-than-expected quarterly loss of 25 cents per share, missing the Street estimate of 10 cents. However, the stock's fortunes reversed as several analysts maintained their bullish stance on the company despite the earnings miss.

Canaccord raised its price target on USA Rare Earth to $23 from $22, maintaining a Buy rating. Benchmark Co. analyst Subash Chandra reiterated a Buy rating with a price target of $15, while Cantor Fitzgerald's Derek Soderberg kept a Buy rating with an even more optimistic price target of $28. These positive analyst actions likely contributed to the stock's impressive intraday recovery and subsequent surge.

The company's CEO, Barbara Humpton, highlighted progress in USA Rare Earth's downstream capabilities, stating, "With the downstream capabilities of our magnet manufacturing plant in Stillwater well underway, which is now complemented by the metal making and strip casting capabilities of LCM, we are closing the loop within the rare earth magnet supply chain." This forward-looking statement may have also helped bolster investor confidence in the company's long-term prospects, despite the short-term earnings setback.