Livent Corp (LTHM)

[TradingCharts]

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Livent Is Susceptible To More Downside



Summary


•The backbone of Livent's lithium operation is its Salar del Hombre Muerto brine project in Argentina that provides the feedstock for its diversified lithium product line.

•Livent's lithium metal intellectual property could one day be an even more important asset. I explain why.

•Livent may have the lowest cost brine production, but Albemarle appears to have the lowest overall cost structure.

•I see shares of Livent as susceptible to more downside.

• This idea was discussed in more depth with members of my private investing community, Industrial Minefinder. Get started today »


Livent's Background

Livent (LTHM) was formed in 2018 when FMC Corporation (FMC) spun off its lithium business. The backbone of Livent's lithium operation is its Salar del Hombre Muerto brine project in Argentina that provides the lithium feedstock for its butyllithium, lithium chloride, lithium hydroxide, and high purity lithium metal production. Albemarle (ALB) and Livent are the 2 main producers of butyllithium which is used in pharmaceutical and polymer applications. Jiangxi Ganfeng Lithium ("Ganfeng") and Livent are the 2 main producers of lithium metal which is used in battery and aerospace applications.

It is worth noting that the future development of solid state batteries would require lithium metal and Livent is currently the only producer of lithium metal in the Western Hemisphere. Livent's intellectual property here could one day become an important asset. The previous lithium business of FMC (now Livent) has a long and storied history in the lithium industry as shown on this pre-spinoff investor presentation slide:
https://seekingalpha.com/article/4285387-livent-susceptible-downside?mod=mw_quote_news