Livent (NYSE:LTHM) is a cautionary tale of lithium miners. The company spun off from FMC (NYSE:FMC) in October 2018. The investing thesis at the time was that FMC was among the largest global lithium businesses and the company’s management wanted Livent to make lithium its sole focus.
But the stock never got going. And then just when investors started to recognized the potential to be had from lithium, the novel coronavirus wreaked havoc on supply chains.
This affected the company’s top and bottom lines in 2020. But if you’re going to invest in lithium, you’ve got to be playing the long game. The company generates approximately 61% of its revenue from lithium carbonate, lithium hydroxide and lithium chloride which are used in the EV market. And the company has a supply agreement with Tesla that runs through 2021.
And recently, investors in LTHM stock have been nicely rewarded. The stock recently reached its all-time high at $23.99 and although it’s had a pull back, the stock is still trading above IPO levels. The company is pledging to be carbon neutral by 2040.
About Livent
Livent Corporation manufactures and sells performance lithium based batteries, specialty polymer, and chemical synthesis applications in North America, Latin America, Europe, the Middle East, Africa, and the Asia Pacific. The company offers lithium compounds for use in applications that have specific performance requirements, including battery-grade lithium hydroxide for use in high performance lithium-ion batteries; and butyllithium, which is used in the production of polymers and pharmaceutical products, as well as a range of specialty lithium compounds, including high purity lithium metal, which is used in the production of lightweight materials for aerospace applications and non-rechargeable batteries. READ MORE
Current Price: $19.43
Consensus Rating: Hold
Ratings Breakdown: 2 Buy Ratings, 7 Hold Ratings, 1 Sell Ratings.
Consensus Price Target: $14.44 (25.7% Downside)
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