The Vulcan Energy Resources Ltd (ASX: VUL) share price has been a positive performer on Tuesday.
In morning trade, the lithium developer’s shares are up 1% to $9.11.
Where next for the Vulcan share price?
Although the Vulcan share price has rocketed materially higher over the last 18 months, one broker doesn’t believe it is too late to invest.
In fact, this broker appears to believe that Vulcan could be the best value lithium share on the Australian share market.
According to a note out of Germany-based Alster Research, its analysts have put a buy rating and $25.00 price target on the company’s shares.
Based on the current Vulcan share price, this implies potential upside of ~175% over the next 12 months.
What did the broker say?
Alster Research highlights that Vulcan has finalised its agreement with LG Energy Solution (LGES), the world’s second-largest battery maker. This will see LGES purchase between 41,000 to 50,000 tonnes of battery grade lithium chemicals over an initial term of five years from 2025.
In addition, the broker notes that Vulcan shares will be trading on the Frankfurt Stock Exchange (FSE) later this month. It expects this to be a positive catalyst.
The broker explained: “By finalizing the deal with LGES, Vulcan has now five definitive agreements with high-profile customers. We consider this as a clear sign for the high demand for battery metals from the phasing out of the combustion engine.”
“At this point, Vulcan has marketed its initial production volumes for the first 5-6 years. We expect the upcoming definitive feasibility study (DFS) to create some leeway. In the near term, we expect the admission to FSE as a catalyst for the stock, as future capital increases will be accessible to a broader audience. Thus, liquidity and interest will most likely increase. We confirm our PT of AUD 25.00, equivalent to EUR 15.81, and reiterate our BUY recommendation,” it concluded.
The post Lithium boom! Broker says the Vulcan (ASX:VUL) share price has 175% upside appeared first on The Motley Fool Australia.
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More reading
- Here’s why the Vulcan Energy (ASX:VUL) share price is climbing today
- Vulcan (ASX:VUL) share price tumbles despite Italian lithium project news
- Here’s why the Vulcan Energy (ASX:VUL) share price is powering ahead today
- Why Vulcan (ASX:VUL) could be a lithium share with 120% upside
- Here’s why the Vulcan Energy (ASX:VUL) share price is climbing today
Motley Fool contributor James Mickleboro 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 Bruce Jackson.
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