The Lithium Americas mining company received positive recommendations

The overall situation in the lithium mining market is improving, and demand for this metal is growing, which creates favorable conditions for the Lithium Americas Corp. (LAC), Wall Street analysts believe. As a result, Deutsche Bank specialists announced an upgrade of the Lithium Americas stock rating to “buy” and set a target price of $34. 

According to analysts, all lithium producers “can benefit from a favorable price environment.” Furthermore, an additional growth factor for Lithium Americas will be the expected start of production in the Cauchari-Olaroz basin in Argentina in the middle of this year. As a result, Piper Sandler analysts improved the recommendation on Lithium Americas shares to “above market” and raised the target price to $41, which implies a 34% increase from the current price. 

The company believes that Lithium Americas can get permission to start mining in Nevada as early as February or March. In addition, Piper Sandler analysts also expect production in Argentina this year. However, it should note that Lithium Americas does not have significant production volumes, revenues, and profits so far. 

At the same time, Wall Street analysts are optimistic that the price of lithium is growing because Lithium Americas may report a formal profit by the end of 2022. Real profit (GAAP) may begin as early as next year. The risk for Lithium Americas remains the possibility of a new type of battery that does not require lithium. 

However, it is unlikely that an alternative to lithium-ion batteries already mastered in mass production will appear before 2030—the existing projects at upgrading batteries with lithium electrodes — primarily to replace the flammable liquid electrolyte.