In this piece, we will take a look at the ten best lithium stocks to buy now. If you want to jump ahead to the top five stocks in this list, then head on over to the 5 Best Lithium Stocks to Buy Now.
Just as the internal combustion vehicle is dependent on the crude oil industry, the burgeoning electric vehicle industry depends on the lithium industry. This highly volatile material is used to manufacture batteries and is essential to power electric vehicles due to its electrochemical properties.
Therefore, the lithium industry is a crucial sector that needs to be on everyone’s radar. Naturally, there are dozens of optimistic market research estimates for this industry as well. One report from Market Research Future estimates that this sector will be worth $6.62 billion by the end of 2028, and until then it will grow at a compounded annual growth rate of 8.1% beginning from 2021.
Another report from Fortune Business Insights has the exact same estimates for the sector but also shares other details. The research firm believes that the lithium industry was worth $3.6 billion in 2020, and over the next eight years, it will grow at an 8.1% CAGR and be worth $6.6 billion by 2028 end. Additionally, Fortune Business Insights outlines that out of the myriad of applications for lithium, the battery segment will continue to dominate the market in the future as well, and while North America will see rapid growth in the industry, the bulk of the market share will be held by Asia Pacific.
Finally, Transparency Market Research focuses its attention on the global lithium-ion battery market. The firm estimates that this market was worth $21 billion in 2021 and it will grow at a much faster 11% CAGR for an estimated worth of $58 billion by 2031. It lists the growth in electric vehicles and others such as electric bicycles as significant industry drivers. Asia Pacific is the largest market for electric vehicles and having a large population with demand for consumer electronics is expected to drive this growth, suggests the report.
Therefore, we’ve compiled a list of some of the top lithium companies for you today, and some of the heavy hitters in this post are Albemarle Corporation (NYSE:ALB), Livent Corporation (NYSE:LTHM), and Sociedad Química y Minera de Chile S.A. (NYSE:SQM).
Photo by Mika Baumeister on Unsplash
Our Methodology
In order to pick the top lithium stocks for you to invest in, we took an eagle eyed view of the industry to identify the relevant trends and the main companies. After this, the top firms were isolated based on a variety of aspects such as their current relevance to industry developments and financial metrics such as share price valuation, revenue growth, market size and share, and more. The firms were then ranked according to hedge fund sentiment courtesy of Insider Monkey’s 895 hedge fund survey for this year’s second quarter.
10 Best Lithium Stocks to Buy Now
10. Pilbara Minerals Limited (OTCMKTS:PLBF)
Number of Hedge Fund Holders: N/A
Pilbara Minerals Limited (OTCMKTS:PILBF) is an Australian company that explores, develops, and operates mineral mining properties. The company owns a lithium mining project in Western Australia and it is headquartered in West Perth.
Pilbara Minerals Limited (OTCMKTS:PILBF)’s mining property in Australia is the world’s largest hard rock mine, which lends it a considerable command of the industry. Due to this, the company has strong relationships with battery makers, and one of its customers is the supplier for the German automobile giant Volkswagen. Additionally, Pilbara Minerals Limited (OTCMKTS:PILBF)’s mine is located just 100 kilometers away from the nearest seaport. As an additional testament to its strength, the company has grown its revenues by 153% year over year over the last three years.
JPMorgan kept an AUD3.5 price target for the company in August 2022 and downgraded its rating to Neutral from Overweight.
In addition to Livent Corporation (NYSE:LTHM), Albemarle Corporation (NYSE:ALB), and Sociedad Química y Minera de Chile S.A. (NYSE:SQM), Pilbara Minerals Limited (OTCMKTS:PILBF) is another top lithium stock that just might be worth checking out.
9. Ganfeng Lithium Co., Ltd. (OTCMKTS:GNENY)
Number of Hedge Fund Holders: N/A
Ganfeng Lithium Co., Ltd. (OTCMKTS:GNENY) is a Chinese company that manufactures and sells different types of lithium products. These include battery grade lithium oxide and lithium carbonate, alongside lithium fluoride. The firm also sells lithium ingots, rods, polymer batteries, and lithium aluminum foil, indicating that it is one of the most diversified lithium companies in the world. The company has mining interests in countries all over the globe, and it also offers other services such as lithium battery recycling. Ganfeng Lithium Co., Ltd. (OTCMKTS:GNENY) is headquartered in Xinyu, China.
Ganfeng Lithium Co., Ltd. (OTCMKTS:GNENY) was ranked as the world’s third largest manufacturer of lithium chemicals in 2020. It is also a high growth company with its price to earnings ratio based on earnings per share forecasts estimated to sit at 25.8x and as go as high as 29.7x. Ganfeng Lithium Co., Ltd. (OTCMKTS:GNENY) is also on track to acquire one of Argentina’s largest lithium carbonate reserves with an estimated capacity of 30,000 tons per year and the deal can make the company one of the largest lithium producers in the world. It is also one of the few lithium producers that are vertically integrated, with Ganfeng Lithium Co., Ltd. (OTCMKTS:GNENY) also capable of manufacturing batteries.
8. Sigma Lithium Corporation (NASDAQ:SGML)
Number of Hedge Fund Holders: 3
Sigma Lithium Corporation (NASDAQ:SGML) is a Brazilian company that focuses exclusively on exploring and developing lithium reserves. The company owns lithium mines all over Brazil, and collectively its sites cover an area of 191 square kilometers. The firm is headquartered in Sao Paulo.
Sigma Lithium Corporation (NASDAQ:SGML) has access to a staggering 85.7 Mt of lithium reserves, making it one of the dominant players in the industry. The size of these reserves ensures a steady supply for the company, with the third phase of its current mining operations slated to start in 2025. Through operating margins of 82%, a lithium price of $1,790 per ton, and a discount rate of 8%, Sigma Lithium Corporation (NASDAQ:SGML)’s share price appears to be undervalued.
Insider Monkey’s 895 hedge fund survey for this year’s second quarter saw three investors in Sigma Lithium Corporation (NASDAQ:SGML).
Out of these, Jack Ripsteen’s Potrero Capital Research is Sigma Lithium Corporation (NASDAQ:SGML)’s largest investor as it owns 847,394 shares that are worth $13 million.
7. Standard Lithium Ltd. (NYSE:SLI)
Number of Hedge Fund Holders: 4
Standard Lithium Ltd. (NYSE:SLI) is a Canadian company that is involved in the exploration, development, and production of lithium brine. The company has several mining facilities and the largest of these is in Arkansas, which is quite crucial to the company as you will find out below. This site has close to 150,000 acres of brine leases. Standard Lithium Ltd. (NYSE:SLI) is headquartered in Vancouver, Canada.
Standard Lithium Ltd. (NYSE:SLI)’s mining properties in Arkansas lend it several key advantages such as the fact that it has to pay little attention to protecting the environment since no rare species are there, there is abundant water, and the overall regulatory environment is more favorable than other areas. Finally, the net present value of its projects stands to go as high as $2.3 billion based on the percentages of ownership interests.
Four out of the 895 hedge funds that were part of Insider Monkey’s Q2 2022 survey had invested in Standard Lithium Ltd. (NYSE:SLI).
Standard Lithium Ltd. (NYSE:SLI)’s largest investor is Israel Englander’s Millennium Management which owns 204,231 shares that are worth $871 million.
6. Lithium Americas Corp. (NYSE:LAC)
Number of Hedge Fund Holders: 9
Lithium Americas Corp. (NYSE:LAC) is another lithium mining company that has ownership interests in several properties in Argentina and in the United States. It has properties in the two Argentinian provinces of Salta and Jujuy. Additionally, it also owns a property in North-Western Nevada, United States. The firm is headquartered in Vancouver, Canada.
Lithium Americas Corp. (NYSE:LAC)’s mining sites in Argentina have a total tonne per annum capacity that exceeds 100,000 tpa. The company is also slated to strongly benefit from renewed U.S. government interest in lithium mining, with Lithium Americas Corp. (NYSE:LAC)’s CEO having outlined that the government is offering loans to fund as much as 50% of new project costs. Additionally, the Pentagon is also keen on building strategic lithium national reserves owing to the metal’s importance for electric vehicles and modern day life.
Lithium Americas Corp. (NYSE:LAC) has officially submitted a loan investment to the Department of Energy for a mining site in Nevada, which is also strategically close to Tesla’s Gigafactory.
Albemarle Corporation (NYSE:ALB), Livent Corporation (NYSE:LTHM), and Sociedad Química y Minera de Chile S.A. (NYSE:SQM) are met by Lithium Americas Corp. (NYSE:LAC) in our list today for the top lithium stocks that you can get your hands on at the moment.
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Disclosure: None. 10 Best Lithium Stocks to Buy Now is originally published on Insider Monkey.
