Best lithium stocks to buy in 2022
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Lithium has a wide range of uses and is a key component in the production of batteries, especially in the growing electric vehicle market. Our experts have selected five of the best stocks in the lithium industry and this guide explains where and how you can buy them.
What are the top lithium stocks to buy?
In the table below, you can find our experts’ five best lithium stock picks for 2022. Click on the links to sign up with a broker and start investing, or continue reading to learn more about each company.
|#||Stock ticker||Company name||Where to trade|
|3||SQM||Sociedad Quimica y Minera de Chile|
1. Albemarle NYSE: ALB
Albermarle corporation is one of the worlds leading lithium producers. Headquartered in North Carolina, the company has lithium mining operations in the United States, Chile, and Australia. Additionally, it operates several battery-grade lithium manufacturing plants in China, Europe, and Australia.
ALB produces many speciality chemicals alongside lithium, including Bromine and Catalysts. While its business is diverse, the rising demand for lithium has helped its stock price reach new highs in recent years. In 2022 the company’s shares traded for over $300 each, a considerable rise from $50 at the start of 2020.
Albermarle corporation is our experts’ top pick for the lithium industry. The rising demand for electric vehicles has helped ALB over the years; however, the company isn’t solely dependent on a single industry and produces over 100 lithium-based products for many global markets. ALB also heavily features in a number of the best lithium ETFs.
2. Ganfeng Lithium SZSE: 002460
Gangfeng is China’s largest lithium producer and offers the broadest exposure to the base metal of any company on our list. It has multiple mining projects in the Chinese mainland and Australia, and has recently partnered with other miners in Ireland, Argentina, Mali, and Mexico.
In addition to its mining activities, Ganfeng produces lithium batteries and provides a recycling facility giving it wide exposure to the whole lithium supply chain. It sells its products in China and internationally, counting companies like BYD and Tesla as customers.
Investors looking to invest in a lithium stock will struggle to find another company offering the level of exposure Ganfeng does. Its international presence and dominance in the ever-growing Chinese market put it in a great position to capitalise on the expected continuation of rising lithium prices.
3. Sociedad Quimica y Minera de Chile NYSE: SQM
Based in Chile, Sociedad Quimica y Minera produces a wide range of commodities such as iodine, nitrate, potassium, and lithium. Although located in South America, the company trades on the New York Stock Exchange and operates globally, with sales in more than 110 countries.
Lithium makes up a small part of SQM’s business, but it claims to have the world’s highest concentration of the base metal. It supplies battery and industrial grade lithium and has grown production to over 100,000 tons in 2021. Its share price has reflected its commitment to the lithium industry and has risen nearly 500% from 2020.
Sociedad Quimica y Minera de Chile isn’t a pure-play lithium stock and has a diversified business model. However, it appears to have taken steps to increase its share of the market and has already joined forces with lithium miners in Australia, such as Kidman Resources. SQM offers a way to invest in lithium without risking it all on one specific chemical making it one of the top lithium stocks for 2022
4. Livent Corporation NYSE: LTHM
Livent Corp is one of the largest pure-play lithium stocks and, until 2018, was part of the chemical manufacturing firm FMC. FMC separated from LTHM to focus on its agricultural chemical production. This made Livent the largest pure lithium stock globally, excluding China.
The company has projects in many locations, but its primary mining activities occur in Argentina, where its been operating for over two decades. It extracts lithium carbonate, which is sent to manufacturing plants in Europe, the USA, and Asia. Its lithium carbonate is turned into lithium hydroxide and supplied to the electric vehicle market.
Livent Corporation is a relatively new company, so there isn’t much historical information on its stock, although since becoming a single entity in 2018, its share price has doubled. FMC still has an equity interest in LTHM and the company has been growing rapidly in Asia, where much of its revenue comes from.
5. Lithium Americas NYSE: LAC
As lithium prices have skyrocketed in recent years, several smaller companies have entered the market. The final place on our best lithium stock for 2022 list goes to Lithium Americas. Headquartered in Canada, the company trades on the Toronto and New York stock exchanges and is the most speculative business on our list.
The company has two mining projects underway; the Cauchari-Olaroz brine in Argentina and the Thacker Pass hard-rock in the United States. Experts believe its site in Nevada holds the largest lithium reserve in the US. Its work in Argentina is part of a joint venture with Ganfeng Lithium (number 2 on our list).
Lithium Americas is a small company and investing in its stock is highly speculative, so you shouldn’t put all your money into it. However, its Nevada mining activity could produce significant amounts of lithium which would likely cause its stock to soar.
Where to buy the best lithium stocks
If you want to invest in any of the companies we’ve discussed above, you’ll need to register with an online broker that offers their shares. Below you can find a selection of our expertly selected platforms. Click on any of the links to register an account and buy the best lithium stocks.
What is a lithium stock?
It’s a company that operates in the lithium industry. The lithium industry is diverse and companies within it can focus on different aspects of the lithium supply chain. This can include companies that mine lithium, manufacture it, transport it, and use it, such as electric vehicle firms.
Many lithium stocks belong to businesses that also operate in other industries. For example, some of the companies on our list also produce other chemicals, although a few are lithium pure plays. Lithium stocks generally rise and fall in value along with the price of lithium itself. Investing in these companies means you are also betting on the price of lithium to rise in the future.
Are lithium stocks a good investment?
If the past few years have convinced you that lithium’s price will continue to rise, then yes, lithium stocks are a good investment. While lithium has a broad range of uses, its most valuable in the production of batteries and, more specifically, in the electric vehicle sector.
If you invest in a lithium stock, you’re also gaining exposure to the underlying price of the commodity as well as the wider EV market. As the world shifts away from traditional vehicles, the EV market is expected to reach staggering heights. The International Energy Agency predicts that by 2030 there may be as many as 125 million electric vehicles on the road, which, if true, will only accelerate the price of lithium.
Ultimately, whether lithium stocks are a good investment will depend on how big the electric vehicle market will grow. If you decide to invest, you should keep up to date with the latest lithium news and market analysis, which you can do on any of the links below.
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