Investing in Lithium: Stocks to Watch in 2022

As the EV industry takes off, the demand for lithium continues to rise. A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries fxcm canada review including legal, construction management, and healthcare. What makes Livent stand out from the crowd is its quarterly financial performances. Since the fourth quarter of 2021, the company beat its consensus estimate for earnings per share. Further, the earnings nominally have grown substantially from the doldrums of 2020 and 2021.

It’s, therefore, not a particularly strong income stock, especially given the unpredictable nature of payments to shareholders. Albemarle has increased its dividend for over 25 consecutive years. As you can see, lithium production is highly concentrated, with substantially all of it being produced by just five countries and Australia being a majority on its own. Moreover, of these five, spodumene makes up the lion’s share (~90%) of mineral-derived lithium.

lithium stocks 2021

Second, the company is working at the Falchani Lithium Project located in Peru, which represents the sixth-largest lithium deposit in the world, per American Lithium’s website. While a speculative venture, PILBF held its own through the troubles of 2022. For example, in the trailing year, shares managed to gain nearly 2%. Further, it’s also off to a great start in the new year, moving up 15.5%.

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More recently, it’s been picking up its head, and even had a nice bull run up to $6 in February of 2021. Now might be a great time to buy because it’s low, but still up from its valley in 2019. Defiance ETFs is not affiliated with these financial service firms. Their listing should not be viewed as a recommendation or endorsement. By clicking the buttons above you are leaving the Defiance ETFs website and going to a 3rd party site. I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours.

I have no business relationship with any company whose stock is mentioned in this article. In-depth research reports on stocks that are well-positioned to beat earnings estimates. If you want to focus on EV battery manufacturers, Asia presents the best investment opportunities as this region dominates the EV battery market by a country mile.

lithium stocks 2021

I specialize in U.S. equities and incorporate a top-down approach to identify developing macro-level trends and the companies that would benefit from such trends. I am a strong believer that the best investment opportunities could be found in under-covered equities. Please click the “Follow” button to get timely updates on new articles. Fundamentally, what’s arguably most attractive about Rio Tinto is its broad footprint.

In China, where EV sales are up 90% on the year, Morgan Stanley says “there appears to be ‘overproduction’ of batteries.” It has a 90 Relative Strength Rating, an exclusive IBD Stock Checkup gauge for share-price movement that tops at 99. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 78% of retail investor accounts lose money when spread betting and/or trading CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money. So, a clear pattern is emerging with the firm rapidly growing its revenue base by hundreds of millions of dollars each year during that period.

Tech Stocks To Watch In The Stock Market Today

The company is expanding its production footprint in order to increase capacity. It is expanding in Argentina and should be finished in late 2022. The Dividend Kings List is even more exclusive than the Dividend Aristocrats. It is comprised of 44 stocks with 50+ years of consecutive dividend increases. The Dividend Achievers List is comprised of ~350 stocks with 10+ years of consecutive dividend increases. Toshiba’s revenue has waned in recent years, but the company is under a sale process currently.

  • Legacy automakers have big plans to electrify their vehicle lineups in the coming years, which means millions of new EVs could be sold.
  • A wide variety of analysts are bullish on the market as electric vehicles continue to prosper, and lithium demand from that segment alone is expected to continue to rise.
  • The firm is making sure that they are ready to capitalize on the current boom in demand for lithium products, and it looks like a very positive move for them overall.
  • Most of them have small market caps, giving them lots of room to grow.

You don’t want to invest any more money than you can comfortably afford to lose in NVLHF. Chances are, Nevada Lithium Resources will provide a tax deduction rather than lithium resources if you get my drift. It reported a remarkable increase in its supply capacity, exceeding 100,000 tonnes, and expects to produce 600,000 tonnes by 2030. Such promising results have brought investors and those in the global market looking for a lithium upsurge.

That figure represented a 1064% increase on a year-over-year basis. Volumes increased 63% during the same period so it was a massive price spike that accounted for the outsized increase in revenues. If all of that weren’t compelling enough, ALB stock also includes a modest dividend yielding 0.61%. So, while it may not have as much upside as some of the less well-known shares on this list, it’s better established and less risky. We consider many other lithium stocks too risky, as there are many unknowns coupled with tremendous expectations. Even if you do happen to pick the “winners,” you still have to be concerned about the price you pay.

Tesla is already eyeing the prospect of building a lithium processing facility in Texas, as the company looks to take more control over key manufacturing components amid rising prices. Automakers and battery suppliers are currently scrambling to lock down the lithium supplies to meet EV sales targets for 2024, 2025 and beyond. In July, General Motors agreed to pay Livent $198 million in advance to secure supply starting in 2025. Lithium carbonate spot prices in China, the biggest EV market and a huge user of lithium, climbed to a record $84,000 per ton in November. The precious metal was around 560,000 yuan, or $79,500, per ton this week in China, which also handles most of the world’s lithium refining. Use our news and insight tools to keep track of news about lithium and the overall industry.

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What is the attraction of lithium companies’ stock?

The company mines lithium and refines it into intermediate materials used to produce batteries for EVs and handheld devices. Since Li-Cycle has only a brief tenure as a public company, there is limited financial data for analysis. The company’s sales grew 102% over the prior four quarters, but EPS remains negative, with no current projections on when earnings could go positive. Thanks to the rapidly climbing demand for EV batteries, lithium metal prices have gone through the roof. The price of lithium has quadrupled in the 12 months to September 2022 and would be even higher if the U.S. dollar had not soared in value. All these catalysts could make this an incredible lithium penny stock to own and gain from.

lithium stocks 2021

Battery-grade lithium prices, however, have stabilized somewhat in the past couple of years. Mobile device adoption will continue to be a driver, but electric vehicles require thousands of times as much lithium and hence have a much more significant influence. This has caused interest in investing in lithium stocks to surge.

The company recycles batteries to recover lithium and other materials. This is the lowest grade on our list, but the company is still slightly investable. Morningstar looks at factors, such as financial leverage, balance sheet health and cash flow statements to develop its financial health grade. If you’re interested in other EV investing opportunities, check out these top EV charging station stocks. It went to ninety cents, then came back down to around twenty-five cents.

However, for those willing to ride out the narrative, LAC is one of the lithium stocks that will make you rich in 10 years. Albemarle obtains this powerful commodity with solar evaporation of its ponds that are located in Chile and Nevada and also retrieves lithium with hard rock mining. In addition to lithium, the company has a bromine specialties business segment which includes products for fire safety and water treatment facilities. Since it’s the world’s second-largest producer of bromine, it’s nice to know that the company isn’t 100% reliant on one product. Albemarle stock also offers investors a 1.03% dividend yield, which is intriguing because the majority of stocks that offer investors exposure to the EV market don’t pay dividends.

Start Trading Stocks in 3 Days Learn how to trade stocks like a pro with just 3 email lessons! Sign up for free today.MarketDiem Flash Sale Seize the market with top trade ideas delivered daily—get 1 year of MarketDiem for $20.Follow IBD on TikTok! Boost your investing and personal finance knowledge with bite-size educational videos. Tesla has said commercial production could get underway by the end of 2024, if the project wins project approval. Also, in Tesla’s second-quarter earnings call in late July, Musk did some hawking for the lithium trade.

Top 9 Lithium Stocks

Albemarle is an established player in the fast-growing lithium market, and the company has been profitable in each of the last 10 years. This has enabled Albemarle to reward shareholders with dividends as well, and the company has increased the dividend for 28 consecutive years. After all, these lithium producers have close business relationships with EV battery manufacturers, so investing in these stocks will give an indirect exposure to the Asian battery manufacturing giants. SQM, based in Chile, is a low-cost producer of lithium as well as iodine and nitrates used in fertilizers. The Lithium and Derivatives business segment of the company accounted for 40% of revenue in 2021, which confirms the company’s strong focus on its lithium business.

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The company is the second-largest lithium mine based on its proven and probable reserves, showcasing a bright future for Lithium Americas. With lithium pricing steadily rising, it’s no wonder why investors are so excited about LAC stock, which provides significant leverage to a burgeoning market that shows no signs of slowing down any time soon. As another pre-revenue company and penny stock, shares carry a lot of risk. However, given their low price, investors may feel that the potential upside in Tearlach far outweighs the risk of taking a small position here.

The likes of which power a wide array of tech from our handheld electronics to automobiles. Notably, regarding the latter, this is where electric vehicles come into play. Livent is a pure-play lithium producer, and the company is known for its low-cost production of carbonate, especially in Argentina.

There are a limited number of public companies that mine and refine lithium, plus a host of smaller startup operations that are in the early exploration or development stages of their resources. Forbes Advisor has identified eight lithium stocks that are worth looking at, including both more speculative startup names for well-established python django developer resume maker & example mining companies. Government mandates and increased environmental awareness are driving the electric vehicle market up. Along with the market increasing, demand for lithium and batteries increases also. Sociedad Quimica y Minera is a chemical company and a supplier of iodine, lithium, and industrial chemicals.

The US is a tiny player in this market, with a fraction of a percent of the market share. Unlike many commodities, investors cannot physically hold lithium due to its dangerous properties. However, those looking to get into the lithium market have many options when it comes to how to invest in lithium. On December 5, Tearlach announced further acquisitions, this time the option to acquire a 100 percent interest in Pakwan and Margot Lake in the Electric Avenue region. Here the Investing News Network takes a look at the top lithium stocks with year-to-date gains.

Industry Outlook

Nevertheless, over the past five years, lithium stocks have fared well and prices have risen. A wide variety of analysts are bullish on the market as electric vehicles continue to prosper, and lithium demand from that segment alone is expected to continue to rise. These experts believe the lithium story’s strength will continue over the next decades as producers struggle to meet rapidly growing demand. In late July, Nevada Sunrise received an exploration permit for Gemini that increased the number of boreholes at the project to 12, six of which were planned for a Phase 2 drilling program at the project. The company’s share price spiked significantly, from C$0.22 on August 23 to C$0.38 on August 30, a new year-to-date high for the company, although it did not release news during that time period. In addition, LAC benefits from robust support among covering analysts.

It has invested across the entire spectrum of lithium and battery tech companies, from industry leaders such as Albemarle, Samsung, and Panasonic. These projects will help the company’s portfolio to become well-rounded, allowing for an impressive range of production, manufacturing, and distribution possibilities. This makes investing in the best lithium stocks an opportunity that savvy investors need to take notice of. It’s no surprise that producers are scurrying to identify viable resources to meet these enormous production needs.

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