It is fair to say that Liontown Ltd (ASX: LTR) shares have been roaring over the past 12 months.
During this time, the lithium miner's shares have risen by a massive 200%.
While this is great news for shareholders, does it mean that the rest of us have missed the boat?
Let's see what Bell Potter is saying about the miner following its second quarter update this week.
What is the broker saying?
Bell Potter highlights that Liontown's quarterly update was a touch on the mixed side with positives and negatives.
The negatives were that its production and revenue were softer than it expected. However, this was offset with better than expected costs and improvements with its cash flow.
Commenting on the update, the broker said:
LTR reported December 2025 quarterly spodumene concentrate production of 105kt (BP est. 109kt), sales of 112kt (BP est. 120kt) and revenues of $130m (BP est. $150m). While sales and realised prices were marginally weaker than we had expected, unit costs were also lower. LTR maintained a strong cash position of $390m (prior quarter end $420m), with operating cash flow break even and capex of $27m.
Separately, LTR announced that LG Energy Solution has elected to convert its entire US$250m convertible note holding into equity, representing approximately 239m LTR shares at a conversion price of $1.62/sh (including accrued interest). Upon completion, LGES will hold around 8% of LTR's issued shares and debt will reduce to $315m (excluding leases, Ford Facility $300m and WA Government's loan $15m).
Production growth opportunity
Bell Potter also notes that Liontown has spoken about looking into expanding its production capacity. However, this would ultimately depend on the strength of lithium prices. It said:
The recent strength in lithium markets has motivated the company to revisit Kathleen Valley expansion options, potentially taking mining and plant throughput to 4Mtpa (from 2.8Mtpa) through de-bottlenecking and incremental capacity additions. This study is expected to be completed in mid-2026 and FID is subject to sustained lithium market strength and Board approvals.
Should you buy Liontown shares?
Despite the mixed quarter, Bell Potter remains positive on Liontown shares.
This morning, the broker has reaffirmed its buy rating with a trimmed price target of $2.42 (from $2.48). Based on its current share price of $2.05, this implies potential upside of 18% over the next 12 months.
The broker's buy rating is supported by current lithium strength and Liontown's highly strategic asset. It concludes:
Following the LGES note conversion, LTR will be in a net cash position. Over FY26- 27, LTR will continue to ramp up and de-risk Kathleen Valley. With current lithium price strength, LTR can rapidly generate cash to support incremental production expansions and shareholder returns. Kathleen Valley is 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. The company has a strong balance sheet with long tenor debt finance.
