MP stock soars as the U.S. Defense Department becomes the company’s largest shareholder. Investors are still recommended to tread with caution.

As of 10:17 a.m. ET on Friday, shares of MP Materials stock had climbed 6.5%.

MP Materials (MP) was a big mover last session on higher-than-average trading volume. The latest trend in earnings estimate revisions might not help the stock continue moving higher in the near term.

MP Materials (NYSE: MP) is up 50% today after an announcement that the Department of Defense is buying $400 million of preferred stock in the company. This will make the Pentagon the largest shareholder here.

The Department of Justice announced a $400 billion investment in MP to fund a huge rare earths processing plant expansion. In conjunction, the DoD agreed to a long-term purchase agreement with a minimum price and volume commitments.

On Thursday, the United States Department of Defense (DOD) entered a major deal with MP Materials. The DOD agreed to buy $400 million of MP Materials newly created preferred shares stock. The move will make the U.S. military the company’s largest stakeholder. In the hours after the deal, the company’s stock surged more than 50%.

US-based rare earth producer MP Materials has entered a public-private partnership with the US Department of Defense (DoD) to advance the domestic rare earth magnet supply chain and lessen reliance on foreign sources.