Current Valuations Are 'Quite Expensive': Why This Livent Analyst Is Bearish

Livent Corp. (NYSE: LTHM) spot prices already reflect scarcity value and “not what is grounded by marginal producer economics,” according to Bank of America Securities (BofA).

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The Livent Analyst: Matthew DeYoe downgraded the rating for Livent from Neutral to Underperform, while reducing the price target from $31 to $27.

The Livent Analyst: The shift from a DCF analysis to NAV indicates that the “current valuations are quite expensive,” DeYoe said in the downgrade note.

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“The NAV model for Livent shows continued buildout of the company’s Argentina footprint up to phase 5 expansion which would take them to 100kmt of lithium carbonate,” the analyst wrote.

“In addition, we forecast a full ramp at Nemaska and eventual full ownership of the asset. Said mine is expected to have a ~30-year mine life, so our NAV carries those revenues out to the mid-2050s,” he added.

See Also: Where Analysts Stand With Livent

LTHM Price Action: Shares of Livent had declined by 2.38% to $29.89 at the time of publication Monday.