High-potential lithium stocks have emerged as vital players in the advancing parade of the green revolution. Fundamental to the expanding electric vehicle (EV) space and other eco-friendly products, these stocks have become remarkably relevant for smart investors.
The top lithium stocks are gradually distinguishing themselves, and with the growing interest in EVs, these investments are transforming into significant assets for investors seeking high returns. Given lithium’s diverse applications across various industries, it will likely continue to witness a massive surge in demand.
Therefore, the market is currently brimming with possibilities if you’re considering lithium stocks for wealth generation.
Albemarle (ALB)
Albemarle (NYSE:ALB) is a leading lithium producer which has effectively positioned itself in the fast lane of the EV market boom. The firm’s fortunes are linked to the volatile prices of this indispensable battery ingredient. Yet, the rising tide of EV adoption will continue lifting Albemarle’s boat for the foreseeable future.
The company is expanding its lithium conversion capacity and setting ambitious growth targets, a move likely to lead to higher revenue and EBITDA growth. Despite a potential lithium price correction, Albemarle anticipates a promising surge in revenue growth to fall within 35% to 55% for 2023 and a healthy uptick in cash flows.
Further sweetening the deal, Albemarle projects an annual growth rate of 20% to 30% in lithium sales volume through 2027. Coupled with prospects of higher price realization in the forthcoming years, Albemarle’s outlook sparkles with potential.
Lithium Americas (LAC)
Lithium Americas (NYSE:LAC) is driving into a future fueled by clean energy, revving up a major partnership with auto giant General Motors (NYSE:GM) to operate the Thacker Pass lithium mine in Nevada. The plant is expected to be a harbinger of robust revenues starting from the latter half of 2026. Thacker Pass boasts America’s largest lithium deposit and the world’s second-largest, with an annual EBITDA visibility of $1.18 billion.
Furthermore, the firm is celebrating a milestone at the Caucharí-Olaroz project by producing its initial batch of lower-than-battery-quality lithium carbonate. The completion of additional purification processing equipment by the second half of 2023 is expected to catapult the quality to battery grade.
LAC is also prepping for a split into two distinct entities, one focusing on North American operations and the other on its Argentinian business units. This division could be the magic wand unlocking further value.
Global X Lithium & Battery Tech ETF (LIT)
While Albemarle and Lithium Americas hold considerable sway in the lithium mining sphere, they’re not the only game in town. Moreover, if you throw the massive EV sector into the mix, you have several stocks worth keeping on your radar. Hence, if you’re looking for wide-ranging exposure in the green energy space with a single stock, it’s best to bet on the Global X Lithium & Battery Tech ETF (NYSEARCA:LIT). This savvy ETF isn’t just a ticket to the lithium show; it’s a backstage pass to the entire lithium, EV, and battery universe.
With a modest 0.75% expense ratio, this ETF offers a diversified portfolio, which provides its investors with a well-rounded exposure to every facet of the lithium cycle, from mining and refining to battery production. So, this ETF might be your compass if you’re looking to navigate the electrifying lithium sector. Some of its holdings include Albemarle, BYD Co. (OTCMKTS: BYDDF), Livent Corp. (NYSE:LTHM), and Tesla (NASDAQ:TSLA).
On the date of publication, Muslim Farooque did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
