It has been a very tough time for ASX lithium shares in recent weeks.
Due to sharp declines in the price of the battery-making ingredient (as forewarned here), investors have been hitting the sell button in a panic.
While this is disappointing, some analysts believe that it could have created a compelling buying opportunity for patient investors.
For example, listed below are three ASX lithium shares that have just been tipped to rise over 40% from current levels. Here's what you need to know:
Allkem Ltd (ASX: AKE)
Analysts at Morgans are feeling very bullish about this lithium miner following recent weakness. They have an add rating and a $15.30 price target on its shares, which suggests an upside of 43% from current levels.
Pilbara Minerals Ltd (ASX: PLS)
Another ASX lithium share that Morgans has spoken positively about this week is Pilbara Minerals. The broker has an add rating and a $5.60 price target on its shares, which also implies a potential upside of 43% for investors.
Commenting on Allkem and Pilbara Minerals, the broker said:
Despite continued growth in EV production, lithium prices continue to weaken since the July – August period with spot Chinese prices falling the most. This has impacted the share prices of key pure play producers like PLS and AKE with both stocks declining over the same time frame.
We continue to see value in PLS and AKE with the capability to produce attractive cash flow even at more moderate lithium price levels.
Core Lithium Ltd (ASX: CXO)
Macquarie remains positive on lithium and sees a huge upside in the Core Lithium share price. The broker currently has an outperform rating and 65 cents price target on the ASX lithium share. Based on the latest Core Lithium share price of 35 cents, this implies a potential return of approximately 86% for investors.
It is also worth noting that the broker believes a maiden dividend isn't too far away. It has pencilled in a 2.2 cents per share dividend in FY 2025, which equates to a 6.3% yield.