Wall Street is latching on to this lithium producer. The company’s shares have just been initiated by: Loop Capital, Nomura, Goldman Sachs, Bank of America, and Citigroup with a ‘Buy’ rating.
Livent Corporation (LTHM)
From Pivotal Point
Investors tend to view electric vehicles (EVs) as a niche market. Don’t listen to them; they are missing the point. As battery prices drop, most vehicles are headed toward electric propulsion, and soon. EVs are more efficient than internal combustion engines, easier to service, offer better performance, and ultimately are more fun to drive.
Ford (F) and Volkswagen announced Oct. 31 they were in exploratory talks to jointly develop EVs. The companies are already working together with BMW and Mercedes to develop a network of European fast-charging stations. In September, Volkswagen launched an electric car platform and promised to make 10 million EVs by 2025.
Volvo plans to electrify all of its vehicles by 2019, according to Business Insider. Jaguar’s I-Pace electric SUV is available now, and it’s winning rave reviews. Audi, Mercedes, Porsche and Cadillac will offer speedy EVs within the next two years.
One of the best ways for investors to play this big trend is with Livent Corporation (LTHM).
The business is a recent spin-off from FMC Corp. (FMC), a diversified chemicals company. Livent has become a leading producer and manufacturer of lithium — a critical component in batteries used for EVs, consumer electronics and energy storage solutions.
Prior to the Livent IPO last month, FMC Corp. had been investing aggressively to increase lithium production. The business had sales of $108 million in the fiscal second quarter, an increase of 46% year-over-year.
The company forecast full-year 2018 sales of $430 million to $460 million. In fiscal 2017, the unit had sales of $347.4 million.
The market capitalization is currently only $2.3 billion. Long-term investors could buy Livent into any near-term weakness.
Jon Markman, Pivotal Point, issues@e.moneyandmarkets.com, 1-800-291-8545, November 5, 2018