As the world transitions towards renewable energy and electric transportation, the demand for lithium, a key component in rechargeable batteries, is reaching unprecedented heights. In fact, the market for lithium-ion batteries alone is expected to triple in size by 2025, and the electric vehicle industry is projected to account for nearly half of the global demand for lithium by 2030.
Investors looking to ride this electrifying wave of demand for white gold have a range of exciting investment opportunities at their fingertips. Whether you're interested in exploration, mining, processing, or manufacturing of lithium-related products, there are a plethora of exciting companies to choose from to get in on the action.
From mining companies with significant lithium deposits and exploration potential to manufacturers of lithium-ion batteries and cathodes, these companies are on the cutting edge of the lithium revolution.
So buckle up, because we're about to take you on a thrilling ride through the dynamic world of lithium investing. With high demand, rising prices, and a growing range of investment opportunities, investing in lithium could be the next big commodity rush. Don't miss your chance to be part of this electrifying sector.
Let’s start at the ground level, where the process truly begins. Lithium exploration stocks offer significant profit potential for investors seeking exposure to the rapidly growing demand for lithium. One lithium exploration stock for your watchlist is Brigadier Gold Limited (TSX Venture: BRG, OTC: BGADF). Brigadier is an exploration company led by an experienced management team with decades of experience, leveraging what they believe will be the next major bull market in the natural resource sector.
One of the major considerations to make when researching mining stocks is location, which is also ultimately one of the reasons BGADF is such an attractive buy. Brigadier has chosen Canada, specifically Quebec, as it is one of the best mining jurisdictions in the world.
Recently, Quebec issued a permit to restart the spodumene (a mineral hosting lithium) concentrate operation (Sayona’s North American Lithium mine) that will become one of Canada’s only lithium mines..
Furthermore, Canada has declared its intention to invest C$2 billion towards a mineral strategy aimed at creating a supply chain for EV batteries, indicating that this is not a one-time event.
Driven by a major lithium discovery by Patriot Battery Metals Inc., which recently sent their stock soaring to over a billion dollar valuation, the James Bay region in Quebec, where BGADF is preparing to explore their project, is expected to be the main hub for lithium production in Canada. Northern Quebec is experiencing a renaissance in lithium exploration with comprehensive Federal and Provincial support, a reason for investors to key into companies within the region for profit plays.
Additionally, the province is a very appealing location for investing in lithium project development as it is very supportive of resource development. The region has excellent access to skilled labor, and Quebec's close proximity to the growing electric vehicle markets in Europe and North America.
Another detail for investors to note is that Canada has free trade agreements in place with both the United States and the European Union, making it an even more advantageous location for companies looking to invest in the lithium industry.
On March 14th, BGADF announced the official closure on their flagship asset, the Nemaska2 lithium property. This 3,040-hectare property features over 20 underdeveloped and undrilled spodumene-bearing (a mineral typically hosting lithium) pegmatite outcrops, most averaging 1000 x 900 meters squared. Something that really sets BGADF apart from the rest of the field is their exceptional access to infrastructure, as the property has both an airport as well as a paved highway within its claims.
CEO Rob Birmingham commented on a recent press release: “"We are delighted to have closed the Nemaska2 transaction and have turned our attention to securing the best teams, equipment and technology available to quickly and effectively assess the lithium potential within the Property. Nemaska2 may be the most conveniently located property in the region for access, logistics and infrastructure, which will allow Brigadier to conduct its exploration programs and publish results in an efficient and timely manner."
Nemaska2’s location within the Nemaska Lithium District is adjacent to multiple successful lithium projects, including the Li-Ft Power Lithium Project and Critical Elements Lithium.
Most notably, Brigadier’s Nemaska2 is located ~23 kilometers (~14 miles) West of Nemaska Lithium’s Whabouchi mine, which is considered to be the 2nd richest and biggest lithium deposit in the world, with 27.3 Mt of proven and possible reserves, and a projected mine life of 33 years.
The Nemaska lithium district in Quebec is one of the most promising lithium developments in the world, and with BGADF, investors are able to take advantage of one of the cheapest valuations in the Nemaska lithium district.
Investors looking to get into potentially the next big Canadian lithium story on the market should keep their eyes on Brigadier Gold Ltd. (TSX Venture: BRG, OTC: BGADF). Brigadier is looking to aggressively explore the asset for its lithium potential this Spring, which further positions the stock as an attractive ground floor opportunity.
Another stock in the lithium sector that investors have been paying attention to is Livent Corporation (NYSE: LTHM). Livent is a Philadelphia, Pennsylvania-based, fully integrated lithium company.
LTHM is currently focused on two projects: its lithium hydroxide project in North Carolina and its carbonate expansion in Argentina. In Argentina, the company’s first 10,000 metric ton expansion of its lithium carbonate production is essentially complete, so commercial volumes can be expected to roll in sometime in the second half of 2023.
In North Carolina, Livent is qualifying products with customers at its new 5,000 metric ton lithium hydroxide line and will deliver commercial volumes in 2023.
Livent has demonstrated strong year-over-year earnings growth, with particularly impressive results in the fourth quarter of 2022. During this period, revenue increased by 79% to reach $219.4 million. Additionally, there was a significant increase in GAAP net income, which rose by 1,003%. Adjusted net income also saw a substantial increase of 440% to reach $84.2 million.
Finally, the company's GAAP earnings per share showed a remarkable increase of 875 percent, while adjusted earnings per share rose by 400 percent.
Albemarle Corporation (NYSE:ALB) is a Charlotte, North Carolina-based global leader in transforming essential resources such as lithium and bromine into critical ingredients for mobility, energy, connectivity, and health. Typically classified as a specialty chemicals company, ALB has pivoted and leaned hard into lithium in recent years.
ALB's latest earnings report revealed a net income of $1.13 billion, or $9.60 per share, which is a significant improvement from the previous year's loss of $3.8 million, or 3 cents per share. This outstanding financial performance was primarily due to a remarkable increase in lithium sales, which grew fivefold. Looking ahead, Albemarle anticipates a revenue increase of 55% to 75% in 2023 compared to 2022. Furthermore, the company expects a substantial rise of 50% in adjusted earnings per share.
The final stock is another mining company that could have breakout potential this year.
Lithium Americas Corp. (NYSE: LAC), headquartered in Vancouver, Canada, is a resource company with operations in the United States and Argentina.
Lithium Americas owns interests in the Cauchari-Olaroz project located in Jujuy province of Argentina; the Thacker Pass project located in north-western Nevada; and the Pastos Grandes project located in the Salta province of Argentina.
Despite remaining quiet over the past year, there are signs that this lithium mining stock has a sizable potential upside. This is due to the sustained positive developments on the business front, which point to a promising future.
In January, the company signed a joint development agreement with General Motors (NYSE:GM) for the Thacker Pass mine, with the latter injecting $650 million in equity into the project. Construction for the mine began this month, and the asset has a net present value of $4.95 billion. Once production starts, this asset is anticipated to produce a sizable amount of cash flow, providing investors with a profitable investment opportunity in the world of lithium.
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