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If You Can Only Buy One Lithium Stock in May, It Better Be One of These 3 Names

Lithium prices may finally be bottoming out, creating an opportunity for some of the top lithium stocks to buy now.

For one, according to Canaccord Genuity lithium prices are “poised to rebound by July.”

Canaccord says it’s more confident in its current view that lithium has bottomed than it was last May due to production prices for lithium carbonate equivalent recently falling across several producers,” they added, according to NorthernMiner.com.

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Two, as noted in Lithium Royalty Corp.’s (OTCMKTS:LITRF) latest earnings report, “lithium prices appeared to reach a bottom during the quarter with prices firming up in March. Current market prices for spodumene are trading approximately 25% higher than the lows seen in January and February this year as demand signals continue to firm up led by growth from China.”

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Three, according to Statista, by 2030, global demand for lithium is expected to pass 2.4 metric tons, which doubles the demand forecast for 2025. All of which tell us it’s time to pick up beaten-down lithium stocks to buy, including:

Albemarle (ALB)

Albemarle (ALB) logo on a mobile phone screen
Albemarle (ALB) logo on a mobile phone screen

Source: IgorGolovniov/Shutterstock.com

After pulling back from $137.50, Albemarle (NYSE:ALB) again found support at $124.31 and bounced back to $127.60. From here, I’d like to see ALB initially retest $137.50, especially with lithium prices finally bottoming out.

Making ALB even more attractive as another one of the top lithium stocks to buy, it recently declared a dividend of 40 cents, payable on July 1 to shareholders of record as of June 14.

Helping, the electric vehicle market is showing signs of life again, according to the International Energy Agency. “Every other car sold globally in 2035 is set to be electric based on today’s energy, climate and industrial policy settings, as reflected in the IEA’s Stated Policies Scenario. This has significant impacts on the car fleet. As soon as 2030, almost one in three cars on the roads in China is electric in this scenario, and almost one in five in both the United States and European Union,” noted the IEA.

With these growing catalysts, I’d like to see ALB closer to $200 again near term.

Sociedad Quimia Y Minera (SQM)

Sociedad Quimica y Minera logo displayed on a mobile phone with the company's web page on it. SQM stock
Sociedad Quimica y Minera logo displayed on a mobile phone with the company's web page on it. SQM stock

Source: madamF / Shutterstock.com

I’d also use weakness in Sociedad Quimica Y Minera (NYSE:SQM) as an opportunity.

After finding support at $42.50, SQM ran back to $49.46. Now, if it can break above resistance at around $51, it could potentially retest $62. Also, while we wait for the recovery, we can collect its $0.2134 quarterly dividend, payable May 28 to shareholders of record as of May 10.

Granted, recent earnings weren’t so hot. Its earnings per share loss of $3.04 missed by $1.46. Revenue of $1.08 billion, down 55.2% year over year missed by $60 million. But that’s to be expected when lithium prices plunge as they have. However, the company did revise and increased its lithium sales volume guidance.

“We believe that the strong demand growth in 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,” said SQM CEO Ricardo Ramos.

“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,” he added.

Piedmont Lithium (PLL)

Person holding cellphone with logo of US mining company Piedmont Lithium Inc. (PLL) on screen in front of business webpage. Focus on phone display. Unmodified photo.
Person holding cellphone with logo of US mining company Piedmont Lithium Inc. (PLL) on screen in front of business webpage. Focus on phone display. Unmodified photo.

Source: T. Schneider / Shutterstock.com

The last time I mentioned Piedmont Lithium (NASDAQ:PLL), I noted:

“The company just secured its much-anticipated North Carolina mining permit. With that, according to Piedmont Lithium President and CEO Keith Phillips, ‘We plan to develop Carolina Lithium as one of the lowest-cost, most sustainable lithium hydroxide operations in the world, and as a critical part of the American electric vehicle supply chain.'”

That was on May 2, as PLL traded at $12.20. Today, after testing $16.59, PLL is now trading at $14.50, and is still a strong buy opportunity. Earnings weren’t too hot here either, with lithium prices down. The EPS loss was 61 cents, missing expectations by 73 cents. Revenue of $13.4 million missed by $1.28 million.

However, with lithium prices bottoming out, electric vehicle sales accelerating, and its approved project in North Carolina, I’d like to see PLL double, if not triple from its current undervalued price of $14.50.

On the date of publication, Ian Cooper did not hold (either directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Ian Cooper, a contributor to InvestorPlace.com, has been analyzing stocks and options for web-based advisories since 1999.

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