ALB

Wall Street Favorites: 3 Lithium Stocks With Strong Buy Ratings for May 2024

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Weakness is becoming opportunity for down, but not out lithium stocks to buy.

Look at Albemarle (NYSE:ALB), for example. Since bouncing from triple bottoming support at around $110, ALB is now up to $131.51. From here, if it can break above resistance at $140, it could retest $150 shortly after. Helping, lithium prices are finally showing signs of bottoming out after months of downside. 

Better, according to analysts at Canaccord Genuity, lithium prices and related stocks are “poised to rebound by July.” The firm says lithium prices could reach $16,000 per tonne for chemicals, and $1,200 per tonne for spodumene concentrate.

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,” says NorthernMiner.com.

We also have to consider that once the Federal Reserve starts cutting interest rates, we could see a bounce-back with electric vehicles. All of which should help refuel the upside for lithium. That being said, let’s use the weakness in lithium stocks to buy as an opportunity.

Lithium Stocks With Strong Buy Ratings: 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

After finding strong support at $10.82, Piedmont Lithium (NASDAQ:PLL) just rallied back to $14.30. From here, I’d like to see it run back to $18 near term.

While earnings haven’t been great, that’s to be expected with lithium prices down 80%. However, the big story here is North Carolina, where the company secured its much-anticipated mining permit. With it, according to Piedmont Lithium President and CEO Keith Phillips, “We plan to develop Carolina Lithium as one of the lowest-cost, most sustainable lithium hydroxide operations in the world, and as a critical part of the American electric vehicle supply chain.”

Plus, the company just shipped about 15,500 dry metric tons (dmt) of spodumene concentrate in the first quarter, as North American Lithium (NAL) achieved new quarterly and monthly production records. 

“NAL is forecasted to achieve full run-rate production by H2’24. Based on this projection and per its offtake agreement, Piedmont expects to ship approximately 126,000 dmt of spodumene concentrate in 2024,” they added.

Sociedad Quimica y Minera (SQM)

a pile of lithium. lithium stocks

Source: Bjoern Wylezich/ShutterStock.com

Sociedad Quimica y Minera (NYSE:SQM) just bounced from support at $42. Now consolidating around $48, I’d like to see SQM break higher to test $52 near term.

Better, while we wait for it to push higher, we can collect its yield of 4.35%. The company recently declared a dividend of $0.2134, payable on May 28 to shareholders of record as of May 10. If you missed it, don’t worry about it. More dividends are likely.

Analysts at Jefferies just upgraded SQM to a buy, with a price target of $62.80. “Jefferies sees SQM as an attractive investment due to several factors. These include the company’s competitive advantage in low cash cost for lithium production and the anticipated value boost from the extension of its Chilean lithium concession,” as noted by Investing.com.

And, again, while earnings haven’t been stellar, that’s to be expected with low lithium prices. However, if lithium is finally bottoming, SQM should be one of the top winners.

American Lithium (AMLI)

a lithium mine, ATLX stock. Lithium Stocks to Buy

Source: Shutterstock

Another one of top lithium stocks to buy is American Lithium (NASDAQ:AMLI), which is also coming back strong.

After bottoming out at around 47 cents, it’s now back to 67 cents. From here, I’d like to see it retest resistance at around 85 cents, near term. 

Most recently, AMLI tripled its 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.

The company also holds one of the largest advanced lithium resources in the U.S., with its TLC Lithium Project in Nevada. Even better, Nevada is considered to be the “heart of future US lithium,” as noted in AMLI’s investor deck

The company’s site added that” TLC currently hosts 4.2Mt lithium carbonate equivalent (LCE) measured resources, 4.63Mt LCE indicated resources and 1.86Mt LCE inferred resources.” 

On the date of publication, Ian Cooper did not hold (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.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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