These beaten down ASX lithium stocks could rise 35% to 85% in 12 months

Big returns could be on offer for brave investors according to analysts.

| More on:
A bearded man holds both arms up diagonally and points with his index fingers to the sky with a thrilled look on his face over these rising Tassal share price

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The lithium industry has been a tough place to invest in recent times.

But if you believe that the tide will soon change, then it could be worth taking a look at the three ASX lithium stocks listed below.

That's because they have been named as buys and tipped to rise materially from current levels. Here's what analysts are saying about them:

Arcadium Lithium (ASX: LTM)

Bell Potter remains very positive on this lithium giant. It likes the miner due to its diversified operations, which provide exposure to various lithium types. In addition, it highlights the company's strong production growth potential. It said:

LTM provides the largest, most diversified exposure to lithium in terms of mode of upstream production, asset locations, downstream processing and customer markets. It is a key large-cap leverage to lithium prices and sentiment, which we expect to improve over the medium term. The group has a strong balance sheet and growth portfolio.

The broker has a buy rating and $9.50 price target on its shares. This implies potential upside of approximately 85% for investors.


Over at Goldman Sachs, its analysts are positive on battery materials miner IGO despite being bearish on lithium.

The broker likes IGO due to the low costs of its Greenbushes operation. It feels this leaves IGO well-positioned in the current environment of low prices. It commented:

Greenbushes is the lowest cost lithium asset in our coverage. Production growth more than offsets increasing strip ratio: The addition of CGP3 (under construction) and CGP4 (planned) should take Greenbushes production capacity from ~1.5Mtpa today to ~2.4Mtpa (excluding tailings processing of ~0.3Mtpa), and they are planned to be funded from existing Greenbushes debt facilities, combined with Greenbushes cash flows (though we factor in below nameplate). We reiterate our belief that further Greenbushes expansion remains one of the most economically compelling brownfield lithium projects.

Goldman Sachs has a buy rating and $8.10 price target on IGO's shares. If the ASX lithium stock rose to that level, it would mean a return of 35%.

Liontown Resources Ltd (ASX: LTR)

Analysts at Bell Potter are also very positive on this lithium developer which is on the cusp of becoming a fully-fledged miner.

Liontown's Kathleen Valley (KV) lithium project is due to begin roaring in the middle of the year, which means it is perhaps just weeks away from producing the battery making ingredient.

Bell Potter thinks very highly of the KV project. It said:

100% owned KV lithium project remains highly strategic in terms of its stage of development, long mine life and location. LTR has offtake contracts with top tier EV and battery OEMs (Ford, LG Energy Solution and Tesla). Hancock Prospecting has a 19.9% interest in LTR. LTR is an asset development company; our Speculative risk rating recognises this higher level of risk.

The broker currently has a speculative buy rating and $1.85 price target on the ASX lithium stock. This suggests that upside of 85% is possible from current levels.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Materials Shares

A happy construction worker or miner holds a fistfull of Australian money, indicating a dividends windfall
Materials Shares

Could BHP shares provide an 18% return for investors?

Let's see what Goldman Sachs is saying about this mining giant following its update.

Read more »

Two young risk-taking men pose for the camera as they jump off a cliff into the sea.
Materials Shares

How risky is buying ASX lithium shares right now?

Despite recent losses, this fund manager is holding onto these top ASX lithium stocks. Here’s why.

Read more »

A person wears a roaring lion mask.
Materials Shares

Who is buying 55,000 Liontown shares this week?

Lithium prices remain at multi-year lows, but this insider is putting $53,350 into the industry.

Read more »

Miner looking at a tablet.
Materials Shares

Core Lithium share price rockets 14% amid 'positive achievements'

Investors are sending the Core Lithium share price surging today. But why?

Read more »

Image from either construction, mining or the oil industry of a friendly worker.
Materials Shares

BHP share price on watch after record-breaking FY24 iron ore production

BHP's iron ore operations were on form during the fourth quarter and full year.

Read more »

Miner looking at his notes.
Materials Shares

Should you buy Rio Tinto shares after the miner's update?

Let's see what analysts at Goldman Sachs are saying about the mining giant.

Read more »

A man in trendy clothing sits on a bench in a shopping mall looking at his phone with interest and a surprised look on his face.
Materials Shares

Own Pilbara Minerals shares? Here's what to expect from next week's Q4 update

Here's what the market is expecting from the lithium miner.

Read more »

Two miners standing together.
Materials Shares

Why are BHP and other ASX 200 mining shares getting hammered on Tuesday?

A soft second-quarter update from one of the major miners appears to have spooked investors today.

Read more »