by Ian Cooper

Crisis has become an opportunity for beaten-down lithium stocks.

For one, according to Exxon Mobil, “the world urgently needs more lithium than it’s producing today.” Two, we’re just starting to see electric vehicle sales bounce back. In fact, according to Kelley Blue Book, about 330,460 EVs were sold in the U.S. just in the second quarter. With those numbers likely to improve even more, far more lithium will be needed.

In addition, according to FastMarkets.com, we could see 487% growth in lithium demand to nearly 412,000 tonnes by 2030.

In short, it’s time to buy the excessive fear in lithium before others wake up. 

Albemarle (ALB)

The pullback in Albemarle (ALB) is overdone.

Not expecting for it to stay this low for long, I’d buy it here. While we wait for the eventual recovery, we can collect its 1.73% yield. Its new dividend of $0.405 is payable Oct. 1 to shareholders of record as of Sept. 13.

Sociedad Quimica Y Minera (SQM)

Sociedad Quimica Y Minerais also a buy on weakness.

While we also wait for SQM to recover, we can also collect its yield of about 5.09%.

According to SQM Chief Executive Officer Ricardo Ramos: “We believe that the strong demand growth in the lithium market seen since the beginning of the year could continue for the remainder of the year, with total lithium demand surpassing 1.1 million metric tons during 2024. Given this positive trend in demand growth, especially in China which accounts for almost 75% of global lithium demand, and our updated sales volumes outlook for the year, we believe that our sales volumes could reach 200,000 metric tons in 2024.” 

Arcadium Lithium (ALTM)

Arcadium Lithium (ALTM) is also a buy on weakness.

As a low-cost lithium producer, the company should see massive acceleration in earnings growth with heavier demand for lithium. Two, analysts at RBC Capital just initiated a buy rating on the stock with a price target of $4. As noted by the firm, ALTM offers investors “the most vertically integrated and diversified lithium and chemical exposure across our coverage.”