Although lithium shares have been on fire over the last 12 months, it may not be too late to invest in the sector according to analysts.
For example, the two ASX lithium shares listed below have been tipped as buys recently. Here's what you need to know about them:
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Allkem Ltd (ASX: AKE)
The first ASX lithium share to look at is Allkem. It is the company that was formed following the merger of Galaxy Resources and Orocobre. This merger created a top five global player with a collection of world class operations and projects across Western Australia, Argentina, and Canada.
Macquarie is very positive on Allkem. This is due largely to its belief that lithium prices will remain at record levels for a number of years, which bodes well for Allkem's free cash flow generation in the future.
The broker recently retained its outperform rating and lifted its price target on Allkem's shares by 13% to $13.60. This compares to the latest Allkem share price of $11.43.
Liontown Resources Limited (ASX: LTR)
Another ASX lithium share to consider is Liontown. It is the company behind the Kathleen Valley Lithium Project in Western Australia. This project will be producing 500ktpa of spodumene when it commences in 2024.
From this, the company has just announced an agreement to sell battery manufacturer LG Energy Solution (LGES) a total of 150ktpa of spodumene for a five-year term with pricing linked to industry recognised price reporting indices for lithium hydroxide monohydrate. It also revealed that it is currently in negotiations with other tier-1 customers for the remaining offtake.
Bell Potter is a fan of the company. It currently has a speculative buy rating and $2.15 price target on the company's shares. This compares to the latest Liontown share price of $1.72.
