Why has the Core Lithium share price fallen 26% in a month?

The Core Lithium Ltd (ASX: CXO) share price has tumbled over the past month.

Core Lithium shares have descended nearly 26% since market close on 2 December and are currently fetching $1.02. For perspective, the S&P/ASX 200 (ASX: XJO) has shed 4% in the last month.

So what has been going on with the Core Lithium lately?

What’s impacted Core Lithium in December?

Core Lithium is not the only ASX lithium share that has fallen in the last month. Pilbara Minerals Ltd (ASX: PLS) shares have slid 26% in a month, while Sayona Mining Ltd (ASX: SYA) shares have lost 19%.

Core Lithium shares plunged nearly 30% between market close on 2 December and 28 December before finishing the year on a high.

A bearish note out of Goldman Sachs may have weighed on the company’s shares in early December. The broker put a sell rating on Core Lithium with a $1 price target. The commodity team at Goldman predicted lithium prices would start to fall in the second half of 2023. Analysts said:

Our commodity team now expect lithium prices through 1H23 to reflect the near-term tightness and lagging spodumene contract price pass-through before declining over 2H23.

Electric vehicle demand concerns, the performance of US lithium shares, and the lithium price also weighed on ASX lithium shares in December.

The lithium carbonate price descended 15.6% from CNY 562,500 on 1 December to CNY 474,500 on 30 December.

On the US market, Livent Corp (NYSE: LTHM) shares have shed 24% in the last month, while Sociedad Quimica y Minera de Chile (NYSE: SQM) shares have lost 16%.

In positive news for Core Lithium in December, the team at Macquarie lifted its outlook on the Core Lithium share price to outperform with a $1.30 price target on the share price. This implies a 28% upside based on the current share price.

Macquarie is optimistic about the company’s ability to generate bumper free cash flow in the 2024 and 2025 financial years.

Core Lithium loaded the first shipment of 1.4% lithium oxide direct shipping ore from the Finniss mine on December 30. The ship containing 15,000 dmt of lithium oxide is bound for China from Darwin. Core Lithium shares soared nearly 6% on this day.

Commenting on this news, CEO Gareth Manderson said:

Core has made good progress during 2022 to transition from a mine developer to lithium producer. In 2023 we will continue this transition and the work required to build a quality operating business.”

Core Lithium share price snapshot

The Core Lithium share price has soared 73% in the past 52 weeks.

Core Lithium has a market capitalisation of nearly $1.9 billion based on the current share price.

The post Why has the Core Lithium share price fallen 26% in a month? appeared first on The Motley Fool Australia.

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More reading

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• 5 things to watch on the ASX 200 on Tuesday
• Here’s what I think could impact the Core Lithium share price in 2023
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• These were the best-performing ASX 200 shares of 2022

Motley Fool contributor Monica O’Shea 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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