With demand for lithium growing strongly, analysts have consistently been revising their price forecasts higher over the last 12 months. This bodes well for the many lithium shares that are trading on the Australian share market.
But which lithium shares should you buy? Three that Bell Potter rates as buys today are listed below. Here's what you need to know about them:
Allkem Ltd (ASX: AKE)
According to the note, Bell Potter has upgraded this lithium miner to a buy rating with a vastly improved price target of $17.51.
The broker explained: "The higher lithium price outlook has resulted in large upgrades to our AKE earnings outlook and valuation. EPS changes in this report are: FY22 +12%; FY23 +76%; and FY24 +131%. Our target price is now $17.51/sh (previously $11.00/sh). We have upgraded our recommendation to Buy."
The broker believes Allkem is "a go-to stock for multi-project exposure to lithium markets.'
Lake Resources N.L. (ASX: LKE)
Bell Potter has retained its speculative buy rating and lifted its price target on this lithium developer's shares to $1.82.
The broker said: "LKE's key project is the 50ktpa lithium carbonate Kachi Lithium Brine Project in Argentina. This project is expected to employ direction lithium extraction technology which has enormous ESG benefits compared with incumbent brine and hard rock lithium production methods. With this development project, uncommitted product offtake and an independent share register, LKE has strategic appeal."
Liontown Resources Limited (ASX: LTR)
Finally, Bell Potter has retained its speculative buy rating on this lithium developer's shares and increased the price target on them to $3.06. Its analysts note that the company has recently signed a deal with auto giant Tesla.
Bell Potter commented: "LTR has entered a binding term sheet with Tesla for supply of up to 150ktpa spodumene concentrate from the Kathleen Valley project, adding to an agreement last month with major global battery producer LG Energy Solution (LGES). LTR now has binding term sheets in place for over half of the expected initial production from Kathleen Valley, with offtake pricing linked to market prices for lithium hydroxide. Lithium price upgrades increase our LTR valuation to $3.06/sh."
