The past year has been the tipping point for the world of electric vehicles. Stocks in the electric vehicle industry made huge gains while traditional gas and oil companies suffered. And since electric vehicles are becoming so popular, battery stocks are also gaining momentum because without them there would be no electric vehicle industry. Battey stocks and those related to them are also largely dependent on companies which are refining and also mining lithium which is then used in the development of lithium ion batteries. As the era of electric cars is coming in fast, these battery stocks are getting increasingly popular:
Albemarle Corporation (NYSE: ALB)
Albemarle Corporation (ALB) is a North Carolina-based company that claims to be a leading global producer of Bromine, Lithium, and Catalyst solutions. It has operations in more than 100 countries and has more than 5,400 employees. And while it has major stakes in lithium production and is also the largest lithium producer, it does not mine the lithium itself. Instead, it turns the raw material into usable material for battery manufacturers and since there are heavy restrictions on raw lithium, companies like Albemarle have a large monopoly due to their specialty chemicals.
And since the demand for electric vehicles is on the rise, the demand for electric vehicles is expected to triple which will bring a huge expected raise in ALB’s stocks which have already doubles since the last year started. In the last 12 months leading up to September, in revenues, Albemarle collected more than $3.2 billion. Even during the pandemic, it proved itself to be a profitable firm with $1.09 profits per share in the third quarter of 2020. It is even predicted by the firm that it in fiscal sales this year, it will earn between $3.05 billion to $3.15 billion.
Sociedad Quimica y Minera de Chile (NYSE: SQM)
Sociedad Quimica y Minera de Chile (SQM) is a Chile based company which has recently emerged as one of the best battery stocks in the market, particularly due to its resilient commercial scale supplies capabilities. And while its name puts off certain investors, it is not a new or emerging startup. But Chile possesses the world’s largest lithium reserves, with 8.6 million metric tons of lithium which more than three times than those of Australia. It can easily be seen that Chile based companies will be leading the future in lithium sources and production.
SQM has been producing positive free cash flows each year for the past ten year at least by now and has a strong record. Its annual sales last year were $1.8 billion and its balance sheet has debt which is lower than even that of Albemarle. In the third quarter of last year, Sociedad Quimica produced over 17,600 metric tons lithium which was $0 per cent increase over quarter. This proves that the company managed to stay profitable even during the pandemic.
Livent Corporation (NYSE: LTHM)
Livent corporation (LTHM) is a Philadelphia based lithium company which is largely focused on innovative production of performance lithium compounds. And since lithium ion batteries are used in the production of batteries for electric vehicles, different household application, and even medical gear, LTHM is a hot stock. One of the main advantages of Livent is that it is also involved in providing light weight lithium metal products to both, the aerospace industry and the military. This means that even if the progress for electric vehicles suffers, Livent will remain stocks.
The company is also involved in providing lithium-based polymers for the manufacturing of green products such as modified asphalt. It is also a producer of lithium lubricants. In 2020, Livent was awarded Gold Status by EcoVadis, the Global CSR rating agency, for its sustainability performance. Livent is also involved in the development of the Thacker Pass project in the United States which has the potential to be the leading source of lithium on a large scale.