Lithium Argentina Has Growth Potential, But Analyst Cautions About Valuation Concerns
Portfolio Pulse from Nabaparna Bhattacharya
BMO Capital Markets analyst Joel Jackson resumed coverage on Lithium Americas (Argentina) Corp. (NYSE:LAAC) with a Market Perform rating and a $7.50 price target. LAAC, renamed Lithium Argentina, is an Argentine lithium brine pure-play with its flagship ramping Cauchari-Olaroz JV carbonate/LCE asset. Jackson models a 20kt stage 2 expansion by 2028 for ~$600 million capex (LAAC: ~$300 million), and additional value may come from the 100%-owned, early-stage Pastos Grandes and Sal de la Puna assets. General Motors Company (NYSE:GM) owns about 15 million shares (approximately 9% of the company); however, there is a possibility of divestment post the lockup period.
October 04, 2023 | 8:20 pm
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General Motors Company (NYSE:GM) owns about 15 million shares (approximately 9% of LAAC); however, there is a possibility of divestment post the lockup period.
GM's ownership stake in LAAC could be impacted by the possibility of divestment after the lockup period. This could potentially affect GM's investment portfolio.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 50
NEUTRAL IMPACT
BMO Capital Markets analyst Joel Jackson resumed coverage on Lithium Americas (Argentina) Corp. (NYSE:LAAC) with a Market Perform rating and a $7.50 price target. LAAC is expected to generate around $250 million EBITDA post the Cauchari-Olaroz stage 1 ramp, increasing to approximately $425 million post stage 2.
The analyst's rating and price target indicate a neutral outlook for LAAC. The company's expected EBITDA growth could be a positive factor, but the analyst also notes valuation concerns.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100