In this article, we will discuss the 5 most profitable lithium stocks now. If you want to see more companies in this selection, go to the 10 Most Profitable Lithium Stocks Now.
5. Pilbara Minerals Limited (PLS.AX)
TTM Net Income: $1.14 billion (A$1.69 billion)
Pilbara Minerals Limited (PLS.AX) is a West Perth, Australia-based pure-play lithium company that has the distinction of owning the biggest independent hard-rock lithium operation in the world in Western Australia. The resource is only 120km away from Port Hedland and is responsible for producing concentrates of spodumene and tantalite.
The Pilgangoora Project is considered one of the most vital lithium deposits in the global lithium supply chain. Earlier in February 2023, the company revealed that it has 200,000 tons of spodumene to sell. Pilbara Minerals Limited (PLS.AX) has reached an agreement with a chemical converter that will buy 15,000 tons of spodumene from the company during the first three months of 2023.
4. Ganfeng Lithium Group Co., Ltd. (002460.SZ)
TTM Net Income: $2.55 billion (¥17.55 billion)
Ganfeng Lithium Group Co., Ltd. (002460.SZ) is the largest producer of lithium compounds in China and the third largest in the world.
Ganfeng Lithium Group Co., Ltd. (002460.SZ) intends to reach an annual production capacity of 300,000 tons by 2025 and has applied for 365 national patents. The company has a global headcount of over 10,000 employees. The increase in lithium prices during 2022 has resulted in mining companies posting record profits. Lithium prices have jumped as much as 15 times from their lows in 2020, driven by the global push toward the adoption of EVs. In January 2023, Ganfeng Lithium Group Co., Ltd. (002460.SZ) announced that it intends to invest nearly $2.2 billion (¥15 billion) in two new battery factories to expand operations.
3. Tianqi Lithium Corporation (002466.SZ)
TTM Net Income: $2.55 billion (¥17.53 billion)
Tianqi Lithium Corporation (002466.SZ) is a Chengdu, Sichuan-based vertically integrated lithium company that is involved in the extraction of lithium concentrate along with the production of lithium specialty compounds.
Tianqi Lithium Corporation (002466.SZ) has a presence in the Australian, Chilean, and Chinese lithium markets. The company has a workforce of 1,907 employees and has 167 patents under its belt. Tianqi Lithium Corporation (002466.SZ) is present in the Greenbushes mine in Western Australia through its collaboration with IGO Limited. Furthermore, the company has three chemical plants across China for further processing of lithium that produces industrial-grade lithium carbonate, battery, and industrial-grade lithium hydroxide.
2. Albemarle Corporation (NYSE:ALB)
TTM Net Income: $2.69 billion
Albemarle Corporation (NYSE:ALB) is a Charlotte, North Carolina-based specialty chemicals company. The Energy Storage segment of the business is involved in maintaining its industry leadership in the field of lithium and lithium derivatives.
Albemarle Corporation (NYSE:ALB) has production and storage facilities in North and South America, Europe, and through a joint venture in Australia as well. In a research note issued on February 17, Joel Jackson at BMO Capital increased the price target on Albemarle Corporation (NYSE:ALB) from $315 to $325 and maintained an Outperform rating on the stock. The analyst noted that despite the price of lithium normalizing, Albemarle Corporation (NYSE:ALB) stock still offers a significant upside as it is in a strong position to benefit from the positive demand outlook for lithium.
Here’s what Carillon Tower Advisers said 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.”
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1. Sociedad Química y Minera de Chile S.A. (NYSE:SQM)
TTM Net Income: $3.08 billion
Sociedad Química y Minera de Chile S.A. (NYSE:SQM) is a Santiago, Chile-based chemicals company that has the distinction of being the biggest lithium producer in the world. The company has a presence in 110 countries around the world.
Sociedad Química y Minera de Chile S.A. (NYSE:SQM) intends to have a carbon-neutral lithium production process by 2030. Meanwhile, the company currently uses 97.4% solar energy for the production of lithium. Sociedad Química y Minera de Chile S.A. (NYSE:SQM) is considered the backbone of the Chilean economy and intends to invest $1.3 billion by 2024 to boost the supply of lithium.
In a note issued to investors on January 10, Corinne Blanchard at Deutsche Bank gave Sociedad Química y Minera de Chile S.A. (NYSE:SQM) stock a target price of $95 along with a Buy rating. The analyst sees short-term volatility in the lithium market but has a confident outlook for the second half of the year. You can read the company’s Q4 2022 earnings call transcript here.
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