5 Best Lithium Stocks To Buy Now

In this article, we discuss 5 best lithium stocks to buy now. If you want to read our detailed discussion on the lithium industry, click 11 Best Lithium Stocks To Buy Now. 

5. Sociedad Química y Minera de Chile S.A. (NYSE:SQM)

Number of Hedge Fund Holders: 20

Sociedad Química y Minera de Chile S.A. (NYSE:SQM) specializes in the production and distribution of various specialty plant nutrients, iodine derivatives, lithium derivatives, potassium chloride and sulfate, and industrial chemicals, among other related products and services. Sociedad Química y Minera de Chile S.A. (NYSE:SQM) is one of the best lithium stocks to watch. 

On July 6, Sociedad Química y Minera de Chile S.A. (NYSE:SQM) announced the establishment of a new long-term agreement for the supply of over 100,000 metric tons of battery-grade lithium carbonate and lithium hydroxide to LG Energy in South Korea. This agreement is set to extend until 2029.

According to Insider Monkey’s first quarter database, 20 hedge funds were bullish on Sociedad Química y Minera de Chile S.A. (NYSE:SQM), compared to 25 funds in the prior quarter. Ken Griffin’s Citadel Investment Group is the biggest stakeholder of the company, with 1.5 million shares worth $125 million. 

Here is what ClearBridge Investments has to say about Sociedad Química y Minera de Chile S.A. (NYSE:SQM) in its Q1 2021 investor letter:

“Among materials names in our structural bucket, we sold SQM as the stock hit our price target. Lithium prices remain at levels well below previous highs and while we expect they may reach higher levels in the future; high pricing likely encourages additional supply onto the market.”

4. Livent Corporation (NYSE:LTHM)

Number of Hedge Fund Holders: 32

Livent Corporation (NYSE:LTHM) specializes in the production and distribution of high-performance lithium compounds, primarily utilized in lithium-based batteries, specialty polymers, and chemical synthesis applications. The company was established in 1940 and is headquartered in Philadelphia, Pennsylvania. It is one of the best lithium stocks to invest in. 

On May 10, Livent Corporation (NYSE:LTHM) and Australian lithium miner Allkem announced a merger agreement in an all-stock transaction. This merger will establish a leading global producer of lithium chemicals with a total valuation of $10.6 billion. Under the deal, approximately 56% of the new company will be owned by Allkem shareholders, while Livent Corporation (NYSE:LTHM) shareholders will own the remaining portion. The companies anticipate annual operating synergies of approximately $125 million and one-time capital savings of around $200 million. These savings will be primarily derived from asset proximity and collaborative development efforts in Argentina and Canada.

According to Insider Monkey’s first quarter database, 32 hedge funds were bullish on Livent Corporation (NYSE:LTHM), compared to 29 funds in the prior quarter. Paul Marshall and Ian Wace’s Marshall Wace LLP is a prominent stakeholder of the company, with 1 million shares worth $23 million. 

Carillon Eagle Small Cap Growth Fund made the following comment about Livent Corporation (NYSE:LTHM) in its Q4 2022 investor letter:

“Livent Corporation (NYSE:LTHM) is a pure-play, fully integrated producer of performance lithium compounds. The stock underperformed amid investor concerns about how a potential decelerating rate of growth in overall electric vehicle (EV) production and demand, primarily in China, would affect the future price of lithium. Despite these potential near-term headwinds, longer-term the global lithium market remains tight, and we believe Livent plays a critical role in the battery value chain and remains well- positioned for the overall continued global adoption of EVs.”

3. Rio Tinto Group (NYSE:RIO)

Number of Hedge Fund Holders: 33

Rio Tinto Group (NYSE:RIO)  is focused on the exploration, mining, and processing of mineral resources worldwide. The company offers a diverse range of minerals including lithium, aluminum, copper, iron ore, diamonds, gold, borates, titanium dioxide, salt, silver, and molybdenum. Rio Tinto Group (NYSE:RIO) is one of the premier lithium stocks to monitor. 

On June 28, Rio Tinto Group (NYSE:RIO) disclosed plans to establish a battery lab in Australia to explore and study different technologies related to battery production, manufacturing, and chemistry. While Rio Tinto Group (NYSE:RIO) primarily derives its earnings from iron ore, the company aims to expand its production of commodities crucial to the clean energy transition. However, the company has no intention of becoming a commercial battery manufacturer. 

According to Insider Monkey’s first quarter database, 33 hedge funds were bullish on Rio Tinto Group (NYSE:RIO), compared to 29 funds in the prior quarter. Todd J. Kantor’s Encompass Capital Advisors is the largest stakeholder of the company, with 1.9 million shares worth $132.8 million. 

HL International Equity Strategy made the following comment about Rio Tinto Group (NYSE:RIO) in its first quarter 2023 investor letter:

“In terms of geographical performance, the eurozone emerged as the top-performing region, and our stocks did better still, fueled by the strong performance of Infineon, L’Oréal, and Schneider Electric. EMs, which lagged the index, were boosted by the improving outlook for semiconductor companies TSMC and Samsung. Mexico’s FEMSA also contributed strongly to relative returns. Europe ex EMU was the weakest region primarily due to the underperformance of SE Banken and UK miner Rio Tinto Group (NYSE:RIO). The latter was affected by concerns over softer iron ore pricing in the current year, another reflection of manufacturing weakness in steelmaking giant China.”

2. Albemarle Corporation (NYSE:ALB)

Number of Hedge Fund Holders: 41

Albemarle Corporation (NYSE:ALB) engages in the development, manufacturing, and marketing of engineered specialty chemicals. The company’s Lithium segment offers different lithium compounds used in applications such as lithium batteries for consumer electronics and electric vehicles, high-performance greases, thermoplastic elastomers, rubber soles, plastic bottles, catalysts for chemical reactions, and organic synthesis processes. Albemarle Corporation (NYSE:ALB) is one of the best lithium stocks to invest in. 

On May 18, UBS analyst John Roberts upgraded Albemarle Corporation (NYSE:ALB) to Buy from Neutral with a $255 price target, up from $196, citing the current shift in China’s lithium pricing and the adjustment in 2023 earnings. The analyst believes there is a growing sense of optimism regarding the company.

According to Insider Monkey’s first quarter database, 41 hedge funds were bullish on Albemarle Corporation (NYSE:ALB), compared to 46 funds in the last quarter. 

Carillon Tower Advisors made the following comment about Albemarle Corporation (NYSE:ALB) in its Q4 2022 investor letter:

“Albemarle Corporation (NYSE:ALB) is a global specialty chemicals company with leading positions in lithium, bromine, and refining catalysts. The stock gave back some of its recent gains amid investor concerns about how the future price of lithium could be affected by a potential decelerating rate of growth in overall electric vehicle (EV) production and demand, primarily in China. Despite these potential near-term headwinds, longer-term the global lithium market remains tight, and Albemarle plays a critical role in the battery value chain and remains well-positioned for the overall continued global adoption of EVs.”

1. Tesla, Inc. (NASDAQ:TSLA)

Number of Hedge Fund Holders: 82

Tesla, Inc. (NASDAQ:TSLA) initiated construction on its lithium refinery in the larger Corpus Christi region of Texas in May 2023. The facility, upon its completion, will represent a financial commitment of over $1 billion in the Southwest Texas area. This investment reflects the company’s proactive approach to assure the availability of high-quality lithium hydroxide suitable for batteries within North America. In addition to this, Tesla already manufactures lithium-ion batteries at its Gigafactories. It is one of the best lithium stocks to invest in. 

On July 2, Tesla (NASDAQ:TSLA) announced that it delivered 466,140 electric vehicles during the second quarter of 2023, exceeding initial estimates of 445,000 units. Within the same time period, the company also manufactured 479,700 vehicles. These figures demonstrate a significant surge of 83% in deliveries compared to the 254,695 reported in the same quarter last year. Additionally, there was a growth of 10% in deliveries when compared to the 422,875 vehicles delivered in the first quarter of 2023.

According to Insider Monkey’s first quarter database, 82 hedge funds were bullish on Tesla (NASDAQ:TSLA), compared to 91 funds in the prior quarter. D E Shaw is a prominent stakeholder of the company, with 6.2 million shares worth $1.3 billion. 

Baron Opportunity Fund made the following comment about Tesla, Inc. (NASDAQ:TSLA) in its Q1 2023 investor letter:

“Tesla, Inc. (NASDAQ:TSLA) designs, manufactures, and sells EVs, related software and components, and solar and energy storage products. Following a sharp decline at the end of 2022, Tesla’s stock rebounded in the first quarter of 2023 on investor expectations that Tesla will continue to grow vehicle deliveries and maintain solid gross and operating margins despite a potential recession, competition in China, and vehicle price reductions. We wrote a long piece on Tesla last quarter and refer readers back to it, because for long-term investors not much has changed over the last three months. Tesla did hold its first Investor Day in March, and several Baron analysts and portfolio managers attended. We toured the Austin Gigafactory, drove in a Cybertruck, boarded a Semi truck, and spoke with a wide swath of Tesla senior managers. During the formal presentation, Tesla highlighted, among other things: (1) its broad and deep bench of executive talent supporting CEO Elon Musk; (2) its “Master Plan 3–Sustainable Energy for All of Earth,” which featured EVs, renewable power from solar and wind, and stationary electric storage; (3) its vehicle assembly innovations, including massive casted parts (building Model Y bodies with single front and rear castings, replacing a substantial number of parts and fastening steps), a stainless steel exoskeleton (for Cybertruck), and its next-generation highly efficient “unboxed process” for its next-gen $25,000 vehicle; (4) a future permanent[1]magnet electric motor that will not require any rare earths; and (5) the massive untapped market opportunity for commercial stationary electric storage, branded Megapack, as the world steadily shifts to renewable energy. As long-term shareholders, we have witnessed Tesla exploit its innovative Model 3/Y now-global mass-market platform to increase vehicle deliveries from barely a standing start to over 1.3 million units, while achieving industry-leading margins and reinforcing its iron-clad balance sheet to almost $23 billion in cash (and effectively no recourse debt). We expect Tesla’s next-generation EV and Megapack products to have a similar impact on company results.”

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