Lithium, a key component of the cathode in most electric vehicle (EV) batteries, is not only perhaps the best performing commodity in 2021, but also among the best performing assets of any type this year. Battery grade lithium carbonate prices have approximately quadrupled since December 31, 2020, and the pace of the increase has accelerated over the past few months.
According to China Central Television, this increase in lithium carbonate pricing has increased the cost to produce a battery-powered vehicle by nearly US$500. By comparison, through early October, Bitcoin, with a 49% return, was the broad asset class with the greatest year-to-date appreciation.
A passage in Fastmarkets, a publication which chronicles prices and supply-demand characteristics of many commodities, discussing the status of the lithium market in late November is telling: “A Chinese distributor active in southern Europe that sources lithium technical-grade carbonate said that producers he dealt with preferred to discuss short-term supply contracts rather than committing to long-term contracts on expectations that prices will continue to rise.”
The supply-demand lithium situation has prompted many lithium producers and EV manufacturers, particularly China-based companies, to secure future lithium production capacity. This is the case despite China’s possessing the fourth largest lithium reserves in the world (primarily in its remote Tibet and Qinghai provinces). Indeed, China imports about 70% of its lithium from foreign producers. As U.S.-based EV OEMs ramp up production, they will have to source all lithium from overseas producers as no lithium mines are currently operational in America.
Over the last few months, Ganfeng Lithium, one of the world’s leading lithium producers, and battery maker Contemporary Amperex Technology Co., Limited (CATL), China’s second largest company by stock market value, attempted to acquire( ). Millennial Lithium owns a lithium brine development project in Argentina. Another lithium company, ( ) ultimately outbid both Chinese companies for Millennial.
In September, Ganfeng bought the 9% stake it did not own in another lithium brine project in Argentina called the Mariana project. Mariana is less than 140 kilometers south of Atacama Salar in Chile, the largest producing lithium brine deposit in the world.
In October, Zijin Mining Group, a China-based gold, copper and zinc producer, decided to enter the lithium mining business when it reached a deal to buy( ) for around US$750 million in cash. Neo’s lithium brine project in Catamarca, Argentina is one of the highest-grade projects of its kind.
In early November, Do-Fluoride New Materials of China agreed to supply lithium hexafluophosphate (LiPF6) to BYD, a China-based EV OEM, for four years beginning in January 2022. The supply price was not disclosed.
Finally, on November 29, Stellantis NV (NYSE: STLA), the parent of Fiat Chrysler and Peugeot, signed a five-year agreement starting in 2026 with Germany-based Vulcan Energy Resources Ltd. Vulcan, which plans to utilize clean geothermal energy to produce battery-quality lithium hydroxide, will supply 81,000 to 99,000 tonnes of that material to Stellantis. The accord is predicated on the future successful start of production at Vulcan and full product qualification.
As an aside, even Albemarle Corp. (NYSE: ALB; market cap of US$31 billion), the world’s largest lithium miner, does not rule out acquiring smaller lithium producers, according to Eric Norris, its head of lithium, in an early November interview with Yahoo Finance.
Investors may want to consider two smaller lithium developers,and Sigma Lithium Corporation (NASDAQ: SGMA). The flagship lithium properties for both companies, located in Argentina and Brazil, respectively, are expected to commence production in 2022.
And this is just the start. With the price of lithium expected to continue to rise, more transaction of this nature are surely to arise as global producers look to secure their supply chains in an increasingly electrified world.
Information for this briefing was found via Edgar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
The post Lithium Prices Continue to Soar; Acquisitions And Deals In The Space Are Accelerating appeared first on the deep dive.
Plug Power (NASDAQ:PLUG) Rating Lowered to Hold at Zacks Investment Research
Plug Power (NASDAQ:PLUG) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a research note issued to investors…
According to Zacks, “Plug Power Inc. is a leading provider of alternative energy technology focused on the design, development, commercialization and manufacture of hydrogen fuel cell systems used primarily for the material handling and stationary power market. They are focused on proton exchange membrane, or PEM, fuel cell and fuel processing technologies, fuel cell/battery hybrid technologies, and associated hydrogen storage and dispensing infrastructure from which multiple products are available. They sell and continue to develop fuel cell product solutions to replace lead-acid batteries in material handling vehicles and industrial trucks for some of North America’s largest distribution and manufacturing businesses. Their current product line includes: GenDrive, GenFuel, GenCare, ReliOn, and GenKey. “
PLUG has been the topic of a number of other reports. TheStreet downgraded shares of Plug Power from a “c-” rating to a “d+” rating in a research report on Thursday, December 16th. Wells Fargo & Company lowered their price objective on shares of Plug Power from $40.00 to $26.00 in a research report on Thursday, January 20th. KeyCorp started coverage on shares of Plug Power in a research report on Wednesday, January 5th. They set an “overweight” rating and a $40.00 price objective on the stock. Wolfe Research boosted their price objective on shares of Plug Power from $42.00 to $46.00 and gave the company an “outperform” rating in a research report on Wednesday, November 10th. Finally, Citigroup lowered their price objective on shares of Plug Power from $56.00 to $37.00 in a research report on Tuesday, January 11th. One equities research analyst has rated the stock with a sell rating, seven have issued a hold rating and twenty-one have assigned a buy rating to the company’s stock. According to MarketBeat, the stock currently has an average rating of “Buy” and a consensus target price of $39.78.
PLUG stock opened at $18.76 on Thursday. Plug Power has a 52-week low of $17.51 and a 52-week high of $70.51. The company’s 50 day simple moving average is $29.53 and its 200-day simple moving average is $29.67. The company has a debt-to-equity ratio of 0.11, a current ratio of 17.74 and a quick ratio of 16.89. The firm has a market capitalization of $10.81 billion, a P/E ratio of -11.65 and a beta of 1.45.
Plug Power (NASDAQ:PLUG) last released its quarterly earnings results on Tuesday, November 9th. The electronics maker reported ($0.19) earnings per share (EPS) for the quarter, missing the Zacks’ consensus estimate of ($0.09) by ($0.10). The firm had revenue of $143.92 million for the quarter, compared to analyst estimates of $142.87 million. During the same quarter in the prior year, the company earned ($0.11) EPS. Sell-side analysts predict that Plug Power will post -0.6 EPS for the current fiscal year.
Several hedge funds and other institutional investors have recently bought and sold shares of PLUG. Activest Wealth Management bought a new stake in shares of Plug Power during the 4th quarter worth $28,000. SRS Capital Advisors Inc. raised its stake in Plug Power by 53.3% during the 3rd quarter. SRS Capital Advisors Inc. now owns 1,150 shares of the electronics maker’s stock valued at $29,000 after purchasing an additional 400 shares during the last quarter. Evolution Wealth Advisors LLC raised its stake in Plug Power by 185.1% during the 3rd quarter. Evolution Wealth Advisors LLC now owns 1,280 shares of the electronics maker’s stock valued at $33,000 after purchasing an additional 831 shares during the last quarter. Moors & Cabot Inc. raised its stake in Plug Power by 311.4% during the 3rd quarter. Moors & Cabot Inc. now owns 36,000 shares of the electronics maker’s stock valued at $36,000 after purchasing an additional 27,250 shares during the last quarter. Finally, Gradient Investments LLC raised its stake in Plug Power by 160.5% during the 3rd quarter. Gradient Investments LLC now owns 1,542 shares of the electronics maker’s stock valued at $39,000 after purchasing an additional 950 shares during the last quarter. 49.21% of the stock is owned by institutional investors and hedge funds.
Plug Power Company Profile
Plug Power, Inc provides alternative energy technology, which focuses on the design, development, commercialization, and manufacture of hydrogen and fuel cell systems used primarily for the material handling and stationary power markets. Its fuel cell system solution is designed to replace lead-acid batteries in electric material handling vehicles and industrial trucks for some distribution and manufacturing businesses.
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UPM-Kymmene Oyj (OTCMKTS:UPMMY) Upgraded to Buy at Danske
Danske upgraded shares of UPM-Kymmene Oyj (OTCMKTS:UPMMY) from a sell rating to a buy rating in a research note published on Tuesday morning, The Fly reports….
Danske upgraded shares of UPM-Kymmene Oyj (OTCMKTS:UPMMY) from a sell rating to a buy rating in a research note published on Tuesday morning, The Fly reports.
Several other equities analysts have also commented on UPMMY. UBS Group reissued a neutral rating on shares of UPM-Kymmene Oyj in a report on Wednesday, October 27th. DNB Markets raised UPM-Kymmene Oyj from a hold rating to a buy rating in a report on Monday, January 24th. Finally, Credit Suisse Group reissued a neutral rating on shares of UPM-Kymmene Oyj in a report on Thursday, October 28th. Three analysts have rated the stock with a hold rating and two have given a buy rating to the stock. Based on data from MarketBeat.com, the company has a consensus rating of Hold.
Shares of OTCMKTS UPMMY opened at $36.46 on Tuesday. UPM-Kymmene Oyj has a 12-month low of $34.43 and a 12-month high of $41.77. The business’s fifty day simple moving average is $37.70 and its 200-day simple moving average is $38.05.
About UPM-Kymmene Oyj
UPM-Kymmene Oyj engages in the forest-based bio industry. It operates through UPM Biorefining, UPM Energy, UPM Raflatac, UPM Specialty Papers, UPM Communication Papers, UPM Plywood, and Other operations segments. The company provides softwood, birch, and eucalyptus pulp for tissue, specialty, and graphic papers and packaging; sawn timber for joinery, packaging, furniture, planning, and construction industries; and wood-based renewable diesel and renewable naphtha for the petrochemical industry.
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Jefferies Financial Group Analysts Give Klöckner & Co SE (ETR:KCO) a €14.35 Price Target
Jefferies Financial Group set a €14.35 ($16.31) price objective on Klöckner & Co SE (ETR:KCO) in a report issued on Wednesday morning, Borsen Zeitung…
Jefferies Financial Group set a €14.35 ($16.31) price objective on Klöckner & Co SE (ETR:KCO) in a report issued on Wednesday morning, Borsen Zeitung reports.
KCO has been the topic of a number of other research reports. Deutsche Bank Aktiengesellschaft set a €16.10 ($18.30) price objective on shares of Klöckner & Co SE in a report on Thursday, November 4th. Nord/LB set a €13.00 ($14.77) price objective on shares of Klöckner & Co SE in a report on Wednesday, November 3rd. Credit Suisse Group set a €9.20 ($10.45) price objective on shares of Klöckner & Co SE in a report on Wednesday, November 10th. Warburg Research set a €15.50 ($17.61) price objective on shares of Klöckner & Co SE in a report on Wednesday, November 3rd. Finally, Kepler Capital Markets set a €10.00 ($11.36) target price on shares of Klöckner & Co SE in a research note on Thursday, November 4th. One research analyst has rated the stock with a sell rating, one has assigned a hold rating and five have assigned a buy rating to the company. Based on data from MarketBeat.com, Klöckner & Co SE currently has an average rating of Buy and a consensus price target of €12.81 ($14.55).
KCO stock opened at €9.81 ($11.14) on Wednesday. The company’s 50-day moving average price is €10.37 and its 200 day moving average price is €11.05. The company has a current ratio of 2.04, a quick ratio of 0.88 and a debt-to-equity ratio of 27.18. Klöckner & Co SE has a 52 week low of €7.30 ($8.30) and a 52 week high of €13.49 ($15.33). The company has a market cap of $978.05 million and a P/E ratio of 2.16.
About Klöckner & Co SE
KlÃ¶ckner & Co SE, through its subsidiaries, distributes steel and metal products. It operates through Kloeckner Metals US, Kloeckner Metals Services Europe, Kloeckner Metals Switzerland, and Kloeckner Metals Distribution Europe segments. The company’s product portfolio includes flat steel products; long steel products; tubes and hollow sections; stainless steel and high-grade steel; aluminum products; and special products for building installations, roof and wall construction, and water supply.
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The post Jefferies Financial Group Analysts Give Klöckner & Co SE (ETR:KCO) a €14.35 Price Target appeared first on ETF Daily News.
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