BMO Capital analyst Joel Jackson has maintained their neutral stance on LAC stock, giving a Hold rating yesterday.
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Joel Jackson has given his Hold rating due to a combination of factors surrounding the financial and operational outlook of Lithium Americas Corp. The recent developments at Thacker Pass, including the U.S. Department of Energy receiving equity stakes in exchange for loan deferrals, have impacted the company’s net asset value, which is now estimated at approximately $3.40 per share. This valuation reflects potential risks such as capital expenditure inflation and operational expenses, alongside assumptions of future lithium prices.
Despite the increased target price to $5.00, the decision to maintain a Hold rating stems from uncertainties related to the company’s financial strategies and market conditions. The renegotiated terms with the DOE and General Motors provide some financial relief, but they also introduce dilution and operational risks. Furthermore, the company’s future production timelines and cost forecasts remain subject to change, which contributes to a cautious stance on the stock’s risk-reward profile.
Jackson covers the Basic Materials sector, focusing on stocks such as Corteva, FMC, and Lithium Americas Corp.. According to TipRanks, Jackson has an average return of 6.0% and a 56.90% success rate on recommended stocks.
In another report released yesterday, TD Cowen also maintained a Hold rating on the stock with a $5.00 price target.