Lithium Americas Corp. (LAC – Research Report), the Basic Materials sector company, was revisited by a Wall Street analyst today. Analyst Laurence Alexander from Jefferies maintained a Buy rating on the stock and has a $8.00 price target.
Laurence Alexander has given his Buy rating due to a combination of factors that demonstrate Lithium Americas Corp.’s strong growth potential and strategic financing structure. The anticipated completion of the Department of Energy loan guarantee by this summer marks a shift toward the execution phase for the company, with Phase I mechanical completion targeted for 2027. Lithium Americas Corp.’s projected mid-cycle EBITDA for Phase I is approximately $450 million, which is expected to nearly double after Phase II completion, indicating a solid path to profitability. The company’s strategic partnerships and funding, including a substantial investment from General Motors, provide robust financial support and a secured demand for its lithium production.
Furthermore, the company’s project timeline suggests significant advancement with the construction of Thacker Pass slated to accelerate in the latter half of 2024, aiming for a substantial production capacity of approximately 80,000 tons per year by 2031-2032. This production capacity constitutes a significant portion of the available resource, offering a long-term supply outlook. Alexander’s adjusted financial estimates account for reduced operating expenses in the near term and a cautious approach to the ramp-up of production, as well as a sustainable long-term lithium carbonate price, all of which support the Buy recommendation for Lithium Americas Corp.
According to TipRanks, Alexander is a 4-star analyst with an average return of 2.4% and a 54.62% success rate. Alexander covers the Basic Materials sector, focusing on stocks such as International Flavors & Fragrances, Albemarle, and Ashland.
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Lithium Americas Corp. (LAC) Company Description:
Lithium Americas is a pure-play North American lithium company focused on advancing the 100%-owned Thacker Pass to production. Thacker Pass is located in northern Nevada and is the largest known Measured and Indicated (M&I) lithium resource in the U.S. The project commenced construction in early 2023 and is expected to employ over 1,000 workers during construction and create 500 permanent jobs during operations over its 40-year mine life. The company trades on both the Toronto Stock Exchange (TSX: LAC) and on the New York Stock Exchange (NYSE: LAC).
