These companies are valued based upon the value of their assets in the ground less the expense of extraction, much like any other company that produces commodities. The prices of the physical REEs have been soaring and it won't make much difference in the price of the final product that contain them (aka inelastic demand). For example, if you increase the price of REEs by a factor of 10, the price of an iPhone will increase by $10 to $20.
Since the world has been caught with its pants down, I think countries and companies are in the process of doing the DD on the various REE companies. I wouldn't be surprised to see bidding wars erupt soon by some of the big users, suppliers, and also countries that will stockpile the stuff. For example, a single big wind turbine contains over 700# of Nd. So I will bet the big users like GE and auto companies that manufacture hybrid cars will be scrambling to secure big stable supplies of REE. Many of these companies have staked their future on technologies requiring large quantities of REEs. Without REEs, no more Priuses, Insights, or wind turbines.
I started buying a bunch of REE companies in mid 2010 and I've sat through quite a few 20-40% corrections. I don't think that's going to be any different going forward.
Good Point, h20 -- This stock has potential to be $20, $30 maybe $50-100 in the next few years. Especially if taken over by a major miner, e.g. BHP, Rio Tinto or the Japanese or Koreans.
Something I haven't read yet on the message boards is how much of the buying is by institutions and by foreign companies who recognize the potential of REE. Especially Japanese, Koreans and Taiwanese, whose supplies can be cut off at any time by China. They may have to wait a couple years for actual production, but they are patient, and want the assurance of steady, uninterrupted supplies.
Maybe even the US Dept of Defense is getting smart and realizing that most of our high tech weapons and electronics require rare earths in order to function. And the Chinese govt is not exactly friendly to the US or its neighbors in Asia, especially with strategic materials.