Liontown Resources Ltd (ASX: LTR) shares are having a tough week.
The lithium miner's shares crashed deep into the red on Tuesday.
Is this a buying opportunity for investors? Let's see what Bell Potter is saying about the miner.
What is the broker saying?
Bell Potter was pleased with the company's performance during the first quarter of FY 2026.
And while its revenue was softer than expected, this was due to a delayed shipment. It said:
LTR reported Q1 FY26 concentrate production of 87kt, sales of 77kt (BP est. 69kt) and revenues of $68m (BP est. $76m). Kathleen Valley is ramping up as designed; there are no changes to FY26 guidance. Weaker than expected revenue was driven by lower realised prices and a delayed shipment ($15m impact); unit costs were broadly in line with our estimates.
Cash flows: Operating -$54m (impacted by delayed shipment); investing -$39m; and financing +$357m, the latter benefiting from the August 2025 $372m equity placement. LTR finished the quarter with $420m cash and $274m net debt excluding leases (prior quarter net debt was $541m).
Looking ahead, Bell Potter is feeling very upbeat on the company's production outlook thanks to the ramp-up of underground mining. It adds:
The Kathleen Valley open pit is scheduled to conclude in the current quarter and the ramp-up of the underground is continuing as planned. Operations will improve over FY26 as the cleaner underground ore progressively replaces open pit material, driving improved lithium recoveries and product grades. LTR should also benefit as improved lithium pricing over recent months flows through to lagged-price offtake contracts.
Buy Liontown shares
According to the note, in response to the first quarter update, the broker has retained its buy rating on Liontown shares with an improved price target of $1.30.
Based on its current share price of $1.04, this implies potential upside of 25% for investors over the next 12 months.
Commenting on its buy recommendation, Bell Potter said:
LTR's 100% owned Kathleen Valley lithium project remains highly strategic in terms of scale, long project life and location in a tier-one mining jurisdiction. LTR has offtake contracts with top-tier EV and battery OEMs. Over FY26, LTR will de-risk the ramp up of Kathleen Valley. The company has a strong balance sheet with long tenor debt finance. LTR is highly leveraged to lithium markets, which we expect to improve.
