In this article, we discuss the 10 high-growth lithium stocks to invest in along with the updates around the lithium industry.
Lithium Prices Drop but Demand Signals Long-Term Gains
Rio Tinto announced its acquisition of U.S.-based Arcadium for $6.7 billion, positioning itself as the world’s third-largest lithium miner. The deal comes while lithium prices are falling these days, which are driven by oversupply from China and a slowdown in EV sales, which has made lithium miners attractive takeover targets.
Despite current price drops, the company’s CEO is optimistic about long-term lithium demand, a sentiment shared by Frank Nicolich, CRU Group vice president of base and battery metals. In an interview with Julie Hyman and Josh Lipton of Yahoo Finance, Nicolich explained that while prices are low due to oversupply, mining deals like the one mentioned above are long-term investments.
He expects lithium demand to increase three to four times over the next decade as the transition to clean energy accelerates, making substantial new supply essential. Lithium is highly valued for batteries as it offers the right chemical and electrochemical properties. Although sodium-ion technology may eventually be an alternative, lithium remains universally used in all battery chemistries for now.
Regarding future lithium production, Nicolich pointed to Africa, especially the old tin mines, as a significant near-term source. South America remains a major player, while North America and Canada also have promising lithium deposits. However, U.S. production is currently small, with potential for growth if prices rise.
As lithium demand grows, Nicolich expects more acquisitions as miners seek to position themselves for the future. For investors, the lithium market is still developing. While futures markets for lithium are emerging, such as in China and potentially with the CME, investing in lithium is currently best done through miners rather than direct commodity investments.
We mentioned a similar long-term sentiment in our article about the biggest lithium stocks article posted last month. Here is an excerpt from the article:
“Despite challenges like pricing and demand headwinds in 2023, the U.S. and Canadian lithium sectors are set to make progress in 2024, with several construction projects potentially starting to boost domestic lithium supply. According to an S&P Global report, while the lithium market has seen slow activity and falling prices, especially in Asia, long-term demand fundamentals remain strong due to the global transition toward electric vehicles (EVs) and energy storage.
Even though lithium prices dropped in 2023 after reaching record highs in 2022, the long-term outlook for the EV market remains promising. According to the report, EV sales are expected to reach 30.81 million units by 2027, and lithium prices are expected to stabilize between $20,000 and $25,000 per metric ton in the coming years. Despite the industry’s cyclical nature, current pricing remains strong enough to attract investment, especially with regulatory support driving the EV transition in countries like Canada.”
With that, we look at the 10 High Growth Lithium Stocks to Invest In.
10 High Growth Lithium Stocks to Invest In
Our Methodology
For this article, we used lithium ETFs to identify nearly 50 stocks and we narrowed our list to 30 companies with significant operations in the lithium and battery market. Next, we chose 10 stocks with double-digit 5-year compound annual growth rates (CAGR) in revenue (at least 10%). Our primary metric for listing the stocks was hedge fund sentiment and for the secondary one, mainly for the stocks not trading on NYSE or NASDAQ, we listed according to their average analyst price target upside. The hedge fund sentiment was taken from Insider Monkey’s Q2 database of 912 elite hedge funds.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
10 High Growth Lithium Stocks to Invest In
10. Pilbara Minerals Limited (OTC:PILBF)
5-Year Revenue CAGR: 96.52%
Average Price Target Upside: 57.4%
Number of Hedge Fund Holders: N/A
Pilbara Minerals Limited (OTC:PILBF) owns the world’s largest independent hard-rock lithium operation, located in Western Australia’s Pilbara region. The company produces spodumene and tantalite concentrates at its Pilgangoora Operation. As part of its growth and diversification strategy, it seeks to become a sustainable supplier of battery materials.
The company faced a decline in lithium prices, impacting financial performance. Despite this volatility, it is focused on delivering its commitments and creating value for shareholders and communities. It is one of the best high-growth lithium stocks.
In FY24, Pilbara Minerals (OTC:PILBF) increased production by 17% to 725,329 dry metric tons (dmt) due to the P680 Expansion Project. Despite higher production, financial performance was impacted by a 74% drop in average realized spodumene concentrate prices. The company reported revenues of A$1.3 billion, EBITDA of A$538 million, and a net profit of A$257 million, down significantly from FY23. Operating costs rose 7% to A$654 per dmt due to the expansion project, but freight and royalty costs reduced overall unit costs to A$818 per dmt.
Pricing for spodumene concentrate averaged US$1,176 per ton, a 74% decline from the previous year, which points to industry-wide price volatility. Despite this, the long-term outlook for lithium materials remains positive due to ongoing demand. Pilbara (OTC:PILBF) continues to focus on expanding production capacity and securing strategic agreements to support its growth.
9. Mineral Resources Limited (OTC:MALRF)
5-Year Revenue CAGR: 28.41%
Average Price Target Upside: 58.4%
Number of Hedge Fund Holders: N/A
One of the high-growth lithium stocks, Mineral Resources Limited (OTC:MALRF), also known as MinRes, operates in five segments: Mining Services, Iron Ore, Lithium, Energy, and Other Commodities. Its services include contract crushing, screening, processing, transport, logistics, site services, rehabilitation, and design and construction for the resource industry. The company holds iron ore assets and has stakes in Western Australia’s Wodgina, Mount Marion, and Bald Hill lithium projects, while also focusing on natural gas and energy solutions.
MinRes (OTC:MALRF) reported strong financial results for FY24, highlighted by EBITDA of $1.057 billion. Mining Services grew by 14%, and despite a sharp drop in lithium prices, the lithium division still generated $384 million in EBITDA, while iron ore contributed $394 million. Depreciation and amortization rose due to mine development, and financing costs remained consistent with FY23, largely due to capitalized interest on the Onslow construction.
The company’s operating cash flow reached $1.9 billion, with a positive boost from iron ore prepayments. It made strategic investments in lithium, including the acquisition of Bald Hill, and advanced the Onslow Project, achieving its first ore in May 2024. It also completed a bond offering of $1.1 billion and ended FY24 with a cash position of $900 million and $2 billion in undrawn credit.
MinRes (OTC:MALRF) expects net debt to peak in the first half of FY25 but plans to reduce it in the second half as the Onslow Project ramps up. The company remains committed to disciplined capital allocation and a target gross leverage of two times. Onslow is projected to significantly improve the company’s earnings, with its Mining Services EBITDA set to increase to around $1 billion annually once fully operational by June 2025. The company expects to see substantial deleveraging as the project comes online
8. Sayona Mining Limited (OTC:SYAXF)
5-Year Revenue CAGR: 338.36%
Average Price Target Upside: 100%
Number of Hedge Fund Holders: N/A
Eighth on our list of high-growth lithium stocks is Sayona Mining Limited (OTC:SYAXF), a lithium producer based in North America, with operations in Québec, Canada, and Western Australia. In Québec, the company oversees the North American Lithium operation, along with the Authier Lithium Project and Tansim Lithium Project, in partnership with Piedmont Lithium Inc.
Additionally, the company holds a 60% interest in the Moblan Lithium Project in northern Québec. In Western Australia, Sayona (OTC:SYAXF) has an extensive portfolio of land holdings in the Pilbara region, where it is exploring gold, including potential Hemi-style targets, and lithium. The company’s lithium assets include both owned leases and those in partnership with Morella Corporation.
Sayona (OTC:SYAXF) has had a strong year, marked by significant progress in its North American Lithium (NAL) operation. Since the restart of spodumene concentrate production in March 2023, NAL has achieved noteworthy operational milestones, including a record 49,660 dmt of concentrate produced by June 2024.
The company’s ongoing exploration efforts at NAL confirmed high-grade lithium mineralization, and a recent Mineral Resource Estimate (MRE) increase of 51% to 88 Mt highlights the potential for future production expansion. At the Moblan Lithium Project, significant drilling campaigns confirmed the extent of the high-grade deposit, with an updated MRE showing an 81% increase in resource size.
Moreover, A Definitive Feasibility Study for Moblan, with plans for 300,000 tonnes per year of production, has outlined competitive operating costs, and further drilling is planned in 2024 to upgrade resource categories.
In Western Australia, the company said that its exploration efforts at the Tabba Tabba project are refining the potential for further discoveries. Financially, Sayona (OTC:SYAXF) has maintained strong management and secured the capital needed for infrastructure, technology, and exploration investments.
7. Ganfeng Lithium Group Co., Ltd. (OTC:GNENY)
5-Year Revenue CAGR: 34.76%
Average Price Target Upside: 579%
Number of Hedge Fund Holders: N/A
Ganfeng Lithium Group Co., Ltd. (OTC:GNENY) is a leading global producer of lithium and lithium-related products. The company plays a significant role in the global lithium industry, being China’s top producer of lithium salts and ranking among the largest lithium processors worldwide.
It is actively involved in mining and battery production, catering to the rapidly growing electric vehicle market. With operations spanning across continents, the company maintains investments in lithium projects in countries like Argentina, Australia, and Mali, while supplying major clients such as Tesla and BMW. The company takes the 7th spot on our list of high-growth lithium stocks.
According to Ganfeng Lithium’s (OTC:GNENY) interim half-year report posted at the end of September, the company expanded its production capacity by upgrading current production lines and constructing new ones.
The expansion is aimed at increasing global market share. The company also increased its stake in Mali Lithium to 60%, with the Goulamina spodumene project nearing completion of its flotation line and first production anticipated this year. In Argentina, the Cauchari-Olaroz lithium salt lake project has ramped up to 70% of its design capacity, targeting 20,000-25,000 tonnes of lithium carbonate production by 2024. The Mariana project is expected to start trial production by the end of 2024.
The company produces a wide range of solid-state batteries and has advanced R&D in solid-state battery materials. Additionally, it leads in lithium battery recycling with several facilities in China, capable of processing 200,000 tons annually, achieving high recovery rates for lithium, nickel, and cobalt.
For the future, Ganfeng Lithium (OTC:GNENY) plans to continue expanding its lithium resources globally, focusing on low-cost resources like brine and spodumene. Several lithium projects are in development across China and Argentina, aiming to strengthen its market position and meet growing industry demands.
6. Sociedad Química y Minera de Chile S.A. (NYSE:SQM)
5-Year Revenue CAGR: 21.29%
Average Price Target Upside: 24.22%
Number of Hedge Fund Holders: 9
Sociedad Química y Minera de Chile S.A. (NYSE:SQM) is a leading global producer of lithium, iodine, and specialty plant nutrients. The company has exclusive access to rich mineral reserves in Chile’s Atacama Desert, which includes some of the highest concentrations of lithium worldwide. The strategic access allows SQM to play a critical role in the supply chain for EVs, renewable energy storage, and other industries.
With operations in over 100 countries, it has steadily expanded its presence, securing a strong position in the growing green economy. It held an 18% share of the global lithium market in 2023, selling lithium products to 207 customers across 39 countries, especially in Asia. The company has also partnered with Kidman Resources to acquire spodumene resources in Australia, further expanding its lithium operations.
As demand for EVs and renewable energy storage rises, SQM continues to increase its lithium production capacity, aiming for 210,000 metric tons of lithium carbonate by 2024. The company’s diversified portfolio, which includes iodine and plant nutrients, adds to its resilience and positions it for future growth.
In September, SQM’s CEO Ricardo Ramos highlighted a significant development as he announced a partnership with Codelco to extend operations in the Salar de Atacama until 2060. The partnership, which is expected to take effect in 2025, is contingent upon a consultation process with local Atacameño communities to ensure mutual benefits and respect for human rights.
Moreover, in response to long-term industry trends, SQM launched SQM International Lithium to focus on expanding its lithium business beyond Chile. The new venture aims to increase SQM’s production by at least 100,000 metric tons of LCE annually by the end of the decade through partnerships and innovation. It ranks at 6 on our list of high growth lithium stocks.
5. Ultralife Corporation (NASDAQ:ULBI)
5-Year Revenue CAGR: 13.54%
Average Price Target Upside: 55.56%
Number of Hedge Fund Holders: 11
Ultralife Corporation (NASDAQ:ULBI) provides a range of power solutions, communications, and electronics systems to global customers in government, defense, and commercial sectors.
It manufactures a wide range of non-rechargeable and rechargeable batteries, with a focus on lithium-based technologies. Non-rechargeable batteries, such as Lithium Manganese Dioxide, offer advantages like longer shelf life, stable voltage, and lighter weight compared to traditional alkaline batteries.
In the rechargeable market, Ultralife (NASDAQ:ULBI) sells lithium-ion batteries, which are known for their high energy density and long cycle life, making them suitable for portable electronics and military equipment. It also provides battery charging systems and accessories, including multi-kilowatt lithium-ion battery modules for energy storage and backup power.
On September 30, the company announced that it is further expanding its portfolio with the acquisition of Electrochem Solutions, Inc. for $50 million in cash from Integer Holdings Corporation, with the deal expected to close by the end of October 2024. Electrochem is based in Raynham, Massachusetts, and specializes in primary lithium metal and ultracapacitor cells, as well as battery packs for several industries including energy and military applications. The acquisition is expected to improve Ultralife’s (NASDAQ:ULBI) growth and operational efficiency by using Electrochem’s technology, customer base, and manufacturing capabilities.
The company’s CEO, Mike Manna, emphasized that this acquisition aligns with their strategy to scale operations, expand product offerings, and improve profit margins through synergies and vertical integration. The deal also provides access to new markets and strengthens its competitive position.
4. NIO Inc. (NYSE:NIO)
5-Year Revenue CAGR: 51.18%
Average Price Target Upside: 11.80%
Number of Hedge Fund Holders: 20
One of the high-growth lithium stocks, NIO Inc. (NYSE:NIO) specializes in premium smart electric vehicles and is recognized for its battery swapping technology and Battery as a Service (BaaS) model, offering flexible battery subscription options. Its product lineup includes various SUVs and sedans, including the ET9, set for delivery in 2025.
Its vehicles feature innovations like battery swapping and compatibility with different battery ranges. The company operates in China and several European countries, with plans for further global expansion. It has research and development centers in key global locations. Its battery swapping allows quick battery changes and health assessments, while BaaS decouples battery costs from vehicle prices, which provides users with flexible battery upgrades.
In 2023, NIO (NYSE:NIO) introduced a 150 kWh semi-solid-state battery that extends the driving range of its vehicles to about 930 kilometers (578 miles) per charge, surpassing traditional lithium-ion batteries.
The new technology blends the high energy density of solid-state batteries with the practicality of lithium-ion, which improves vehicle performance. The upgradeable nature of the battery pack adds value for current NIO owners. The company is also developing other battery technologies, including 4680 cells and lithium manganese iron phosphate (LMFP) batteries, to further boost energy density and performance.
NIO (NYSE:NIO) announced its earnings in September where it reported record deliveries of 57,373 vehicles in Q2, a 144% increase year-over-over. The company has captured over 40% of China’s BEV market for models priced above RMB 300,000 (RMB 1 = US$ 0.14).
For the third quarter, it reported a record-high quarterly delivery of 61,855 vehicles, representing an 11.6% growth compared to the previous year. In September alone, the company delivered 21,181 vehicles, a 35.4% year-over-year increase. The deliveries included 20,349 vehicles from NIO’s (NYSE:NIO) premium smart electric vehicle brand and 832 from its family-oriented brand, ONVO. ONVO’s first model, the L60, a mid-size smart electric SUV, launched on September 19, with deliveries starting later that month. The company’s cumulative deliveries reached 598,875 as of September 30, 2024.
3. Albemarle Corporation (NYSE:ALB)
5-Year Revenue CAGR: 16.90%
Average Price Target Upside: 2.91%
Number of Hedge Fund Holders: 32
Albemarle Corporation (NYSE:ALB) is a leading American specialty chemicals company, operating in three segments, lithium, bromine specialties, and catalysts. It plays a significant role in the global lithium market, especially for EV batteries, and is also advancing flame retardant technologies and catalysts for petroleum refining.
The company serves diverse industries such as energy, automotive, electronics, and pharmaceuticals, as it offers products like lithium carbonate and lithium hydroxide for cathode applications, along with innovative solutions like ultra-thin lithium metal anodes and lithium sulfide for improved energy density and safety.
Despite challenges in the lithium market, Albemarle (NYSE:ALB) is focused on increasing its production capacity. It plans to double lithium carbonate production to 10,000 tons per year by 2025 and is developing the Kings Mountain mine in North Carolina to supply domestic lithium. Partnerships with major automakers like Ford and BMW further reinforce its position in the EV industry, with long-term agreements to supply battery-grade lithium hydroxide.
As reported by TipRanks on October 10, DBS is quite optimistic about the company’s potential in the expanding EV and energy storage markets. The firm’s analyst Tina Ting Hu reaffirmed a Buy rating on Albemarle (NYSE:ALB) with a price target of $100. Despite recent declines in net income and sales forecasts, Hu believes the growing demand for lithium, driven by increasing EV adoption, supportive government policies, and technological advancements, will drive its growth.
The company’s upcoming lithium projects are expected to contribute to a 20% compound annual growth rate in sales through 2027. Hu also highlighted Albemarle’s (NYSE:ALB) tolling business expansion, which should boost its ability to meet rising energy storage demand, alongside potential margin improvements despite current challenges.
2. Enphase Energy, Inc. (NASDAQ:ENPH)
5-Year Revenue CAGR: 28.56%
Average Price Target Upside: 28.12%
Number of Hedge Fund Holders: 42
Enphase Energy, Inc. (NASDAQ:ENPH) is a key player in energy technology, known for its solar micro-inverters that convert DC from solar panels into AC for homes and the grid. The company is improving its product lineup with the third-generation IQ battery, offering a 15-year warranty, and has plans for a fourth-generation battery that improves efficiency and cost structure. It is also expanding U.S. production to meet domestic demand and increasing its global presence, especially in Europe and North America.
In September, Enphase (NASDAQ:ENPH) launched its most powerful system in India, which features the scalable IQ Battery 5P and IQ8 Microinverters. The system uses advanced lithium iron phosphate technology, which improves reliability by providing continuous and peak power during frequent outages.
It can also restart using sunlight, making it highly efficient in regions with unstable grids. The lithium-based technology ensures a longer lifespan and safer energy storage compared to traditional batteries. The system is designed to run essential appliances during power failures, reinforcing the company’s focus on durable, high-performance energy solutions for international markets.
Enphase (NASDAQ:ENPH) has been covered by 40 analysts with an average price target of $130. The average price target represents a 28.12% upside to the company’s stock, as of October 14. It ranks at 2 on our list of high-growth lithium stocks.
1. Tesla, Inc. (NASDAQ:TSLA)
5-Year Revenue CAGR: 30.75%
Average Price Target Upside: 2.66%
Number of Hedge Fund Holders: 85
Tesla, Inc. (NASDAQ:TSLA) tops our list of high-growth lithium stocks as it continues to lead the EV and renewable energy sectors and is expanding both its production and innovation efforts. The company is investing $3.6 billion in a new Nevada battery factory to produce larger 4680 battery cells, which are essential for the Cybertruck that demands around 7 GWh of battery capacity annually.
In line with its vertical integration strategy, the company is also investing $1 billion in a Texas lithium refinery that will produce battery-grade lithium hydroxide using an environmentally friendly process. The refinery is expected to generate 50 GWh annually, which improves the company’s battery supply chain and cost efficiency.
Tesla (NASDAQ:TSLA) also leads in EV infrastructure, with its Supercharger network, which surpasses 50,000 stations worldwide and in turn eases the range anxiety for long-distance and urban driving. The company is actively opening its Supercharger network to other automakers and has introduced the North American Charging Standard (NACS), which aims to set industry-wide charging standards.
The latest in the company news is its “We, Robot” event on October 10. The event received mixed reviews from the market. While a number of analysts and experts remained unimpressed by it, many others see a lot of potential. Wedbush reaffirmed its Outperform rating and a $300 price target for Tesla (NASDAQ:TSLA) following the event, as reported by The Fly on October 11.
The firm expressed strong optimism about the company’s advancements in autonomous technology and the Cybercab. The analysts were particularly impressed by the Cybercab, and expect that its pricing could help create a fleet business potentially generating $10 billion annually as it scales in the coming years.
However, Wedbush noted that challenges, including regulatory approval, insurance, and specifics regarding the Cybercab’s launch, will need to be addressed as the company moves forward in transportation innovation.
Analyst Dan Ives said that Tesla (NASDAQ:TSLA) “should have spent more time on details around this strategic autonomous vision.” However, the firm expressed strong disagreement with the idea that the event was disappointing. The firm argues that seeing the Cybercab in person and observing significant advancements in Optimus, which they had hands-on experience with during the event, was impressive.
Additionally, Cathie Wood’s Ark Invest has been bullish on the company stock for a long time and has been the most prominent shareholder of the company according to Insider Monkey’s Q2 database. The firm owned 5.3 million of the company stock, worth $1.05 billion in the quarter. More recently, she purchased approximately 12,700 shares of the stock on October 11.
ClearBridge Investments stated the following regarding Tesla, Inc. (NASDAQ:TSLA) in its Q2 2024 investor letter:
“Tesla, Inc. (NASDAQ:TSLA) manufactures electric vehicles, related software and components, and solar and energy storage products. The stock contributed as Tesla continued to drive vehicle manufacturing costs lower, accelerate the launch of new models, and invest heavily in its lucrative AI initiatives. Shareholders reaffirmed the CEO’s compensation plan, alleviating personnel and legal uncertainties. Despite material operational complexities resulting in significant shutdowns of key manufacturing facilities and lower sales volume, Tesla presented better-than-expected margins in the quarter. It expects to launch a lower cost model as soon as late 2024, which should result in accelerated revenue growth, reduced manufacturing costs, and increased factory utilization. The company continued to advance its autonomous driving capabilities, expanding its already significant data centers and developing its humanoid robot Optimus. These investments increased confidence in the attractive growth opportunities that remain ahead.”
While we acknowledge the potential of Tesla, Inc. (NASDAQ:TSLA) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than TSLA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
Read Next: $30 Trillion Opportunity: 15 Best Humanoid Robot Stocks to Buy According to Morgan Stanley and Jim Cramer Says NVIDIA ‘Has Become A Wasteland’.
Disclosure. None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and investors. Please subscribe to our daily free newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
