3 Lithium Stocks to Buy Now: May 2024


  • Here are just a few top lithium stocks to buy and hold on the cheap.
  • Albemarle (ALB): While we wait for further upside, we can collect its dividend.
  • American Lithium (AMLI): AMLI just tripled the estimated value of its Falchani lithium project.
  • Sigma Lithium (SGML): The company just “significantly expanded its mineral reserves by 40%, now totaling 77 million tonnes.”
Lithium stocks to buy - 3 Lithium Stocks to Buy Now: May 2024

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With multiple key catalysts, it’s time to consider beaten-down lithium stocks to buy.

For one, lithium prices are finally showings signs of bottoming out. According to analysts at Canaccord Genuity, lithium prices and related stocks are “poised to rebound by July.” 

In addition, Canaccord says it’s more confident in its current view that lithium has bottomed than it was last May due to production prices for lithium carbonate equivalent recently falling across several producers,” they added, according to NorthernMiner.com.

Two, electric vehicle sales are actually better than expected. According to Forbes.com, “Global EV sales could hit 17 million in 2024, meaning more than one in five cars sold worldwide will be electric.” Three, with the world going green, we need as much lithium as possible.

Plus, according to Statista, by 2030, global demand for lithium is expected to pass 2.4 metric tons, which doubles the demand forecast for 2025. By 2035, they added, demand could reach 3.8 million tons. Then, by 2040, lithium demand could increase 40 times over with expectations for increased EV adoption and energy storage needs. 

We also have to consider that most of the negativity has been priced into most of the lithium stocks to buy now, including:

Albemarle (ALB)

Albemarle (ALB) logo on a mobile phone screen
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Albemarle (NYSE:ALB) is still cheap. At $127.74, it’s still about 60% off its $320 high in late 2022, with plenty of upside potential. Right now, it’s struggling to make it through triple-top resistance at around $146. However, once it does break through, I’d like to see it initially retest $200.

While we wait for that to happen, we can also collect its recently-announced quarterly dividend of 40 cents. That’s payable on July 1 to shareholders of record as of June 14. Helping, analysts at Deutsche Bank just raised their price target on ALB to $140 with a hold rating. RBC Capital also raised its target to $157, with an outperform rating thanks to strong earnings.

In its first quarter, the company posted adjusted earnings per share of 26 cents on sales of $1.4 billion. The market was only looking for 25 cents on $1.3 billion in sales. While that’s down year over year, that’s to be expected when lithium prices plummet.

American Lithium (AMLI)

a lithium mine, ATLX stock. Lithium Stocks to Buy
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The last time I mentioned American Lithium (NASDAQ:AMLI), I said, “At just 59 cents, I’d like to see it double, even triple from here, even as lithium prices start to show signs of life again. It’s another one of the top penny stocks to buy while it’s cheap.”

That was on May 1 as AMLI traded at about 58 cents. Today, it’s up to 84 cents on a volume spike to about 390,000 shares. While I’m not seeing any new news to support the latest move, I am encouraged by the volume and the price spike.

I’m also encouraged by news AMLI tripled the estimated value of its Falchani lithium projects in Peru. “The company said Falchani’s estimated value has tripled from the previous forecast to $5.11B and that the project would have a potential operating life of 32 years,” as noted by Seeking Alpha.

From its last traded price of 84 cents, I’d like to see the AMLI stock retest $1.30. It just has to break through overhead resistance at its current price.

Sigma Lithium (SGML)

Graphic of Lithium scientific symbol (Li) in the shape of a big white gear with construction equipment and mountain around it. favorite Lithium stocks
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Sigma Lithium (NASDAQ:SGML) is another one of the top lithium stocks to buy.

The last time I mentioned SGML, I said, “Now up to $15.34, if it can break above resistance, it could potentially retest $20 a share, near-term. Helping, analysts at Bank of America raised their price target on the stock to $29 from $27, with a buy rating.”

That was on April 11 as SGML traded at $15.25. Today, it’s up to $18.03. From here, I’d like to see it initially retest $20 a share. 

Helping, the company just “significantly expanded its mineral reserves by 40%, now totaling 77 million tonnes, which prolongs the life of its operations to an estimated 25 years. This increase is expected to bolster the company’s position as a low-cost producer of high-purity lithium, essential for electric vehicle batteries,” as noted by TipRanks.com.

With Sigma Lithium, I’d buy it, forget about it, and check back in a few months. With lithium prices starting to come back, stocks like SGML could take off.

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/2024/05/3-lithium-stocks-to-buy-now-may-2024/.

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