SPECIAL REPORT The Top 7 Stocks for 2024

7 Lithium Stocks with Serious Potential to Make You a Millionaire

Advertisement

  • Albemarle (ALB): Analysts at RBC Capital are maintaining a buy rating on ALB, with a price target of $140.
  • Arcadium Lithium (ALTM): Loop Capital is maintaining a buy rating on the stock with a price target of $9.
  • Sociedad Quimica y Minera (SQM): This lithium stock carries a current yield of 12.42%.
  • Read more about the top lithium stocks that could eventually make you a millionaire!
Lithium stocks with millionaire potential - 7 Lithium Stocks with Serious Potential to Make You a Millionaire

Source: AdityaB. Photography/ShutterStock.com

Lithium stocks have been a disaster with oversupply issues and a drop-off in demand for electric vehicles. But with prices this cheap, it may be time to get greedy with lithium stocks with millionaire potential. Especially if the Federal Reserve does cut rates. 

Right now, interest rates are at a 22-year high of 5.4%, driving up borrowing costs. It’s a big part of why electric vehicle sales are slowing. It’s also why auto companies like General Motors (NYSE:GM) and Ford (NYSE:F) are delaying electric vehicle rollouts

However, once the Federal Reserve does start cutting those rates, pent-up demand for such things should return. And with it, we should see higher lithium prices. 

In addition, as I noted on Jan. 21, “With some lithium mines shutting down or reducing production we could see less supply. This could help stabilize prices and send lithium prices higher with demand.” 

That said, you may want to be well-positioned in lithium stocks with millionaire potential.

Albemarle (ALB)

Albemarle (ALB) logo on a mobile phone screen
Source: IgorGolovniov/Shutterstock.com

After plunging from a high of about $331 to a low of $114.33, the industry’s weakened 800 lb. gorilla, Albemarle (NYSE:ALB) is showing some signs of life. Plus, at 4x earnings, with a yield of 1.39%, you can get paid to wait for this cheap stock to recover.

To help, the company is reducing costs by $95 million a year by cutting expenses and its workforce. According to a press release, the company will focus on permitting at the Kings Mountain spodumene resource and postpone spending.

Better, analysts at RBC Capital are maintaining a buy rating on ALB, with a price target of $140. Also, it may not seem like it at the moment, but ALB is one of the top lithium stocks with millionaire potential.

Arcadium Lithium (ALTM)

a lithium mine, ATLX stock
Source: Shutterstock

There’s also Arcadium Lithium (NYSE:ALTM), the $4.94 billion company that combined Allkem and Livent to create one of the biggest lithium companies in the world.

It’s another cheap stock trading at $4.60, at 5x earnings, and with a price to earnings growth ratio of just 0.33. Helping, Loop Capital is maintaining a buy rating on the stock with a price target of $9.

Arcadium Lithium is one of the largest global producers of lithium chemicals, with $1.9 billion in revenue and over 2,600 employees in 2022, according to the company website.

Sociedad Quimica y Minera (SQM)

Lithium element on the periodic table. Top-rated lithium stocks
Source: tunasalmon / Shutterstock

Sociedad Quimica y Minera (NYSE:SQM) carries a current yield of 12.42%. At $40 a share, it’s trading a 1.24x sales, which is far less than its five-year average of 4.54. 

And, as expected, earnings haven’t been great. In its most recent quarter, SQM said revenue slipped 38% YOY to $1.84 billion. Net income came in 56% lower year over year to $479.9 million, as EPS crumbled 56% to $1.68 year over year. However, it does appear that a good amount of negativity has been priced in. 

Now, while we wait for lithium and SQM to recover, we can collect its dividend yield.

Piedmont Lithium (PLL)

Person holding cellphone with logo of US mining company Piedmont Lithium Inc. (PLL) on screen in front of business webpage. Focus on phone display. Unmodified photo.
Source: T. Schneider / Shutterstock.com

We can also look at Piedmont Lithium (NASDAQ:PLL), another one of the top lithium stocks with millionaire potential.

We’re still waiting to see if its North Carolina mine permit will be granted. If it is, the proposed mine could be significant.

At the same time, it does now hold all permits for its project in Tennessee, where it expects to start construction soon. Piedmont also partnered with Vinland Lithium to advance a project in Newfoundland, Canada. 

And it’s also cutting capital spending this year and just reduced its workforce by 27%. It’s targeting about $10 million in annual savings, according to Seeking Alpha.

Standard Lithium (SLI)

Standard Lithium logo or icon on website page, Illustrative Editorial
Source: Postmodern Studio / Shutterstock.com

Standard Lithium (NYSEAMERICAN:SLI) is another one to keep an eye on.

Remember, its East Texas exploration site had the highest-grade lithium brine in North America.

According to Motley Fool’s Neha Chamaria, high brine grades can lower DLE costs for Standard Lithium, which expects East Texas to be a major source of high-grade brine.

iShares Lithium Miners and Producers ETF (ILIT)

lithium (LI) on the periodic table. top performing lithium stocks
Source: Shutterstock

Or, you can always diversify with 44 lithium names that should recover at some point, with an exchange-traded fund such as the iShares Lithium Miners and Producers ETF (NASDAQ:ILIT).

With an expense ratio of 0.47%, the ETF tracks global lithium miners and producers.

In short, you’re getting a piece of most of the stocks mentioned above plus 38 other lithium stocks for less than $13 a share.

Sprott Lithium Miners ETF (LITP)

rows of lithium ion batteries
Source: Lightboxx/ShutterStock.com

Or, look at the Sprott Lithium Miners ETF (NASDAQ:LITP).

Once lithium prices recover, and they will, related stocks and ETFs like this one will push higher.

With an expense ratio of 0.65%, this is the only pure-play U.S.-listed ETF focused on lithium mining, as noted by SprottETFs.com.

On the date of publication, Ian Cooper did not have (either directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Ian Cooper, a contributor to InvestorPlace.com, has been analyzing stocks and options for web-based advisories since 1999.


Article printed from InvestorPlace Media, https://investorplace.com/2024/02/7-lithium-stocks-with-serious-potential-to-make-you-a-millionaire/.

©2024 InvestorPlace Media, LLC