Lithium carbonate prices have levelled off in recent weeks and now trade at 475,500 yuan/tonne at last check.
Despite a small reversal period, prices for the white salt – which is widely used to make cathode material for lithium-ion batteries when in ‘battery grade’ form – are holding multi-year highs on Wednesday.
New bulls arrive for ASX 200 lithium shares
Analysts at Barrenjoey Markets are heavily bullish on three leading ASX 200 lithium shares.
The broker has initiated coverage with buy calls on each of IGO Ltd (ASX: IGO), Allkem Ltd (ASX: AKE) and Liontown Resources Ltd (ASX: LTR).
It values IGO at $14.50 per share and starts Allkem at $15 while assigning a $1.80 price target for Liontown.
For each of these players, this represents a double-digit upside potential should Barrenjoey’s forecasts come to fruition.
Allkem also received an upgrade from Cowen with an $18 per share valuation, whereas analysts at UBS completely reversed course from a sell to a buy rating on IGO.
In a recent note, the Swiss investment bank was constructive on a number of catalysts, including IGO’s first production of battery-grade lithium hydroxide at Kwinana, the Western Areas transaction and a recent pullback in the share price.
Not only that, but IGO’s exposure to the Greenbushes mine remains a key driver for the miner’s share price, UBS says.
“As the downstream ramps up Greenbushes remains the earnings driver into,” it said, adding that the joint venture with Tianqi is substantially de-risked with the Kwinana update.
UBS values IGO at $12.15 per share.
Foolish summary
Each of these ASX 200 lithium shares has pushed well into the green over the past 12 months. Liontown is up 240% in a year whereas Allkem has surged 120% and IGO 62%.
The post Brokers name 3 ASX 200 lithium shares primed to take off appeared first on The Motley Fool Australia.
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More reading
- Here are the top 10 ASX shares today
- Why Allkem, NAB, Pushpay, and Virgin Money UK shares are rising
- Why are ASX 200 lithium shares kicking goals today?
- Why the IGO share price is rallying on Monday
- These were the best performing ASX 200 shares last week
Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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