The Liontown Resources Limited (ASX: LTR) share price has been a positive performer this week.
Since the end of last week, this ASX lithium developer's shares have gained a sizeable 15%.
This compares favourably to a decent 1.9% gain by the ASX 200 index.
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Can the Liontown share price keep rising?
The good news for investors is that one leading broker believes the Liontown share price can climb materially from current levels.
According to a note out of Bell Potter, its analysts have retained their speculative buy rating with a trimmed price target of $2.87.
Based on the current Liontown share price of $1.12, this implies potential upside of approximately 150% over the next 12 months.
What did the broker say?
Bell Potter notes that Liontown has signed an offtake agreement and also a funding agreement with auto giant Ford, which has paved the way for the company's board to approve the development of the Kathleen Valley Lithium Project.
LTR has announced a Final Investment Decision (FID) for its flagship hard-rock lithium project in Western Australia's northern goldfields, Kathleen Valley. The FID coincides with announcing a $300m debt finance facility with Ford Motor Company and a further 150ktpa spodumene (SC6) binding offtake agreement.
And while the capital cost of the project is expected to be higher than previously forecast, Bell Potter believes this increase is still a good outcome in the current environment.
Containing estimated capital cost escalation ($46m) to around 10% of the initial capital estimate is an excellent outcome in the current inflationary environment.
All in all, the broker feels that Liontown is now "in a strong strategic position in a market for lithium facing supply shortages."
