Eye on Lithium: ‘Downcycle largely played out’, says Morgans, eyeing PLS, MIN, LTR

ASX lithium stocks few and far between in green today
Cheer up, though, big Aussie stockbroking and wealth management firm Morgans spies a bottom… probably
Asra up 20% at least on strong quarterly reporting form. CTN and GSM also travelling well

Our lithium roundup for Thursday, February 1.

Fun times to be writing this column, eh?

You probs don’t need a reminder that lithium “spot” pricing has tanked more than 85% over the past 12 months after rivers of white gold, rainbows, unicorns and outsized gains in 2021 to late 2022.

Consequently, bottom searching has become a favourite pastime for lithium heads and other interested parties.

And here’s an interested party – “Australia’s largest national full-service retail stockbroking and wealth management firm”, Morgans.

Amid the lithium rout, the broker yesterday nominated two lithium stocks it rates a buy right now: Pilbara Minerals (ASX:PLS), Mineral Resources (ASX:MIN).

And one, a cautious hold: Liontown Resources (ASX:LTR).

Okay, no shockers there, really.

Morgans notes that PLS “has the second best hard rock lithium mine in the world and a strong balance sheet” which positions it well to weather the current storm.

MinRes, meanwhile offers “attractive diversified lithium exposure”, says Morgans, with “strengthening contributions from iron ore and mining services” partly offsetting lower lithium earnings.

Liontown, Morgans says, “does hold attractive leverage in a lithium recovery scenario through Kathleen Valley”. But it remains cautious “given the funding hurdles the company is now working through”.

Morgans 3 preferred #lithium stocks $PLS $MIN $LTR pic.twitter.com/6SVi6VbRw3

— BuyLowSellHigh (@BLSHigh) January 31, 2024

Overall, though – here’s the firm’s outlook we’ve jumped on for our bottoming-out headline.

While gloomy lithium forecasts have re-based near-term earnings expectations significantly lower, says Morgans, with further weakness a possibility, it views “the downcycle as largely played out, presenting some attractive opportunities”.

So you’re telling us there’s a chance…

Well, further to this, Morgans added:

“Ultimately the lower spot prices push, the more severe the resulting supply response will become. And as a further consequence, the stronger the future recovery will have to be once demand conditions recover in order to induce new supply from a heavily damaged lithium industry.

“Our base case is nowhere near that severe, instead we expect lithium prices are nearing a floor, with the current rapid decline likely to moderate this half.”

Meanwhile, as Eddy “Market Highlights” Sunarto informed us early doors today:

“Lithium stocks on the ASX are on watch today after BofA analyst, Michael Widmer, slashed his forecast for spodumene prices – by -63% in 2024 and -34% in 2025 – citing waning demand for electric vehicles.

There’s that at play, plus some hawkish tone from Fed boss Jerome Powell overnight, too.

Powell said while the Fed’s interest rate target is “likely at its peak for this tightening cycle”, “we are not declaring victory, we think we still have a way to go.”

“I don’t think it’s likely that the committee will reach a level of confidence by the time of the March meeting,” Powell added.

“If we get very strong inflation data, and it kicks back up then we’ll go slower or later.”

The market is down today on hawkish signals from the Fed.#Lithiumstocks are worse than the market and #EVstocks today.$SGML is unexpectedly down on investors’ sell-the-news approach after reported 27% increase in MRE. pic.twitter.com/l4OZYcDZpN

— Andrey Prykhodko (@Andr_rej) January 31, 2024

ASX lithium form guide:

Scroll or swipe to reveal table. Click headings to sort. Best viewed on a laptop. (Note: figures accurate per ASX at 3pm.)

Stocks missing from this list? Email [email protected] and [email protected]

CODE COMPANY TODAY WEEK 1 MONTH % 12 MONTH % PRICE MARKET CAP ADV Ardiden Ltd 0% 9% 0% -49% 0.175 $10,940,564 AGY Argosy Minerals Ltd -3% 7% -28% -85% 0.097 $140,440,750 1MC Morella Corporation -20% 0% -27% -71% 0.004 $30,893,997 AML Aeon Metals Ltd. 0% 0% -18% -70% 0.009 $9,867,606 ASN Anson Resources Ltd -2% -14% -41% -73% 0.082 $108,002,090 AVZ AVZ Minerals Ltd 0% 0% 0% 0% 0.78 $2,752,409,203 CXO Core Lithium 0% 0% -22% -83% 0.195 $416,702,431 EMH European Metals Hldg 0% 4% -32% -59% 0.29 $36,608,299 EUR European Lithium Ltd 0% -1% -19% 6% 0.085 $118,510,330 GLN Galan Lithium Ltd -3% -21% -39% -64% 0.42 $153,760,442 INF Infinity Lithium -10% -13% -23% -43% 0.077 $39,782,920 INR Ioneer Ltd 0% 9% -20% -72% 0.12 $253,369,458 JLL Jindalee Lithium Ltd -2% -2% -5% -53% 0.985 $60,490,117 LIT Lithium Australia 0% -7% -10% -44% 0.027 $32,999,175 LKE Lake Resources 1% -1% -28% -89% 0.093 $130,998,229 LPD Lepidico Ltd -8% -8% -31% -63% 0.0055 $45,829,848 LPI Lithium Pwr Int Ltd 0% 0% 1% 28% 0.5575 $358,696,328 LTR Liontown Resources -3% 6% -40% -37% 0.995 $2,494,644,298 MIN Mineral Resources. -2% 6% -16% -34% 58.87 $11,701,426,359 MLS Metals Australia 0% 0% -14% -37% 0.032 $19,969,158 AKE Allkem Limited 0% -100% -100% -100% 0 $6,304,350,967 PLL Piedmont Lithium Inc 0% -13% -44% -74% 0.24 $92,618,040 PLS Pilbara Min Ltd -2% 0% -12% -27% 3.465 $10,683,611,205 QPM Queensland Pacific 0% -3% -33% -66% 0.037 $74,463,992 PSC Prospect Res Ltd 1% 2% -6% -27% 0.084 $38,456,553 RLC Reedy Lagoon Corp. 0% 0% 0% -48% 0.005 $3,097,704 SYA Sayona Mining Ltd -4% -13% -46% -85% 0.0385 $411,731,841 TKL Traka Resources 0% 0% -33% -68% 0.002 $3,501,317 TON Triton Min Ltd 3% 0% -22% -53% 0.018 $27,324,372 VUL Vulcan Energy -3% -1% -27% -71% 2.08 $368,236,237 GL1 Globallith 2% -9% -57% -77% 0.515 $131,433,976 BMM Balkanminingandmin -8% -16% -31% -80% 0.076 $5,896,363 LEL Lithenergy -3% -21% -37% -57% 0.36 $38,113,700 ARN Aldoro Resources 0% 20% -12% -56% 0.11 $14,808,612 NMT Neometals Ltd -3% -10% -33% -83% 0.14 $90,290,096 IGO IGO Limited -4% -2% -19% -50% 7.295 $5,724,944,666 AAJ Aruma Resources Ltd 0% 5% -22% -74% 0.021 $4,134,722 PAM Pan Asia Metals 0% 0% 28% -58% 0.16 $26,850,684 AX8 Accelerate Resources -4% -4% -38% -7% 0.026 $15,500,747 AM7 Arcadia Minerals -2% -9% -12% -72% 0.064 $7,088,257 AS2 Askarimetalslimited -8% -19% -37% -82% 0.11 $9,354,026 BYH Bryah Resources Ltd 0% 0% -8% -49% 0.012 $5,203,287 EMS Eastern Metals 0% -8% -6% -61% 0.033 $2,720,066 FG1 Flynngold -5% -7% 10% -42% 0.057 $8,743,455 FRS Forrestaniaresources -4% -17% -11% -84% 0.025 $4,206,429 GSM Golden State Mining 18% 8% -13% -69% 0.013 $3,073,077 IMI Infinitymining -17% -5% -29% -61% 0.1 $14,250,407 LRV Larvottoresources 0% 9% 1% -57% 0.071 $15,876,427 MMC Mitremining 6% 16% -14% -17% 0.2325 $12,471,278 RAG Ragnar Metals Ltd 0% -4% -8% 65% 0.022 $10,427,581 CTN Catalina Resources 25% 67% 11% -50% 0.005 $4,953,948 TMB Tambourahmetals -6% -9% -30% -24% 0.08 $7,049,930 TEM Tempest Minerals 0% 0% -6% -71% 0.0075 $3,893,433 EMC Everest Metals Corp 0% -1% -5% -21% 0.076 $12,485,516 WCN White Cliff Min Ltd -6% 0% 67% 15% 0.015 $21,373,749 WML Woomera Mining Ltd 0% -17% -83% -71% 0.005 $6,090,695 AZL Arizona Lithium Ltd -2% -11% -34% -71% 0.0205 $78,894,288 CRR Critical Resources -7% -7% -38% -76% 0.013 $24,889,904 KGD Kula Gold Limited -33% -50% -60% -79% 0.006 $3,808,907 LRS Latin Resources Ltd -6% -9% -44% 45% 0.16 $475,363,554 PNN Power Minerals Ltd -3% -15% -31% -72% 0.145 $13,106,415 WR1 Winsome Resources 2% -5% -46% -76% 0.565 $105,885,703 KZR Kalamazoo Resources -1% -5% -23% -57% 0.093 $16,263,675 MTM MTM Critical Metals -4% -10% 6% -10% 0.072 $9,322,227 QXR Qx Resources Limited -6% -6% -30% -67% 0.016 $18,871,324 SCN Scorpion Minerals 0% -11% -24% -71% 0.025 $10,236,405 AZI Altamin Limited 0% -9% -9% -34% 0.05 $21,406,097 ENT Enterprise Metals 0% 0% 0% -60% 0.004 $3,207,884 KAI Kairos Minerals Ltd 12% 21% 4% -24% 0.0145 $34,071,858 STM Sunstone Metals Ltd 0% -17% -33% -74% 0.01 $34,877,349 PGD Peregrine Gold 5% -2% 31% -39% 0.315 $20,098,944 AVW Avira Resources Ltd 0% 0% 0% -20% 0.002 $4,267,580 NVA Nova Minerals Ltd 0% -3% -7% -51% 0.335 $70,648,137 GT1 Greentechnology -6% -9% -49% -84% 0.145 $49,174,075 BNR Bulletin Res Ltd -4% -10% -43% -20% 0.08 $24,369,906 CAI Calidus Resources -5% -5% -14% -33% 0.185 $119,438,030 MRR Minrex Resources Ltd 0% 0% -24% -65% 0.013 $14,103,278 A8G Australasian Metals 0% -20% -41% -47% 0.1 $5,212,049 EFE Eastern Resources -13% -13% -13% -59% 0.007 $9,935,572 MQR Marquee Resource Ltd 0% 10% -15% -37% 0.022 $9,094,456 SRZ Stellar Resources 0% 0% 0% -50% 0.007 $8,043,185 LSR Lodestar Minerals -20% -33% -50% -50% 0.002 $5,058,493 NWM Norwest Minerals 0% -4% -11% -62% 0.024 $6,901,668 AOA Ausmon Resorces 0% -17% -17% -64% 0.0025 $2,647,498 VKA Viking Mines Ltd -8% -15% -21% 0% 0.011 $12,303,101 IPT Impact Minerals 0% -8% 9% 20% 0.012 $34,376,447 SRI Sipa Resources Ltd 10% 0% -12% -31% 0.022 $4,563,163 VMC Venus Metals Cor Ltd 5% 7% 5% 17% 0.105 $18,972,868 RGL Riversgold 0% 0% -17% -68% 0.01 $9,676,615 ZNC Zenith Minerals Ltd 0% -18% -10% -45% 0.135 $47,571,419 RAS Ragusa Minerals Ltd 0% 3% -14% -70% 0.031 $4,420,562 G88 Golden Mile Res Ltd -7% -13% -26% -37% 0.014 $4,940,843 EPM Eclipse Metals 0% 7% 0% -64% 0.008 $16,500,434 EVR Ev Resources Ltd 11% 0% -9% -33% 0.01 $9,896,295 WC8 Wildcat Resources 5% 2% -40% 1300% 0.42 $478,335,249 MNS Magnis Energy Tech 0% 0% 0% -90% 0.042 $50,378,922 RIO Rio Tinto Limited -1% 2% -3% 4% 132.17 $49,342,059,165 THR Thor Energy PLC 3% 0% 13% -43% 0.034 $6,139,199 YAR Yari Minerals Ltd 0% 0% -13% -44% 0.01 $4,823,578 MXR Maximus Resources 0% 0% 0% -17% 0.035 $11,233,102 DRE Dreadnought Resources Ltd -2% -15% -32% -81% 0.0205 $73,060,532 MM1 Midasmineralsltd 0% -9% -29% -33% 0.1 $8,674,725 M2R Miramar -4% -4% 10% -71% 0.023 $3,572,869 LLI Loyal Lithium Ltd -6% -13% -27% -55% 0.225 $19,988,957 LRD Lordresourceslimited 0% 0% -6% -69% 0.059 $2,190,795 WMC Wiluna Mining Corp 0% 0% 0% 0% 0.205 $74,238,031 AUN Aurumin 0% 11% 15% -51% 0.03 $10,753,292 ZEO Zeotech Limited 3% -14% -6% -23% 0.03 $50,269,269 ALY Alchemy Resource Ltd 0% -11% -20% -53% 0.008 $9,424,610 LIS Lisenergylimited 0% -9% -17% -59% 0.15 $96,030,035 GW1 Greenwing Resources 6% -3% -30% -68% 0.095 $15,682,633 KTA Krakatoa Resources 0% 5% -44% -53% 0.02 $9,442,144 TYX Tyranna Res Ltd 7% 0% -12% -32% 0.015 $46,023,955 DAF Discovery Alaska Ltd 0% 0% 42% 0% 0.027 $6,324,337 FTL Firetail Resources 0% -2% -23% -59% 0.059 $8,785,428 IR1 Irismetals -11% 17% -33% -47% 0.62 $90,639,487 LNR Lanthanein Resources 8% -7% -43% -69% 0.0065 $7,738,871 DAL Dalaroometalsltd 11% -5% -5% -77% 0.021 $1,572,250 TKM Trek Metals Ltd 0% -8% -8% -53% 0.037 $18,983,844 CY5 Cygnus Metals Ltd 0% -12% -49% -86% 0.069 $20,117,581 TUL Tulla Resources 0% -100% -100% -100% 0 $118,262,971 WES Wesfarmers Limited 0% 1% 2% 17% 57.96 $65,975,092,145 LLL Leolithiumlimited 0% 0% 0% -17% 0.505 $498,553,663 OCN Oceanalithiumlimited -2% -19% -48% -83% 0.062 $3,406,820 A11 Atlantic Lithium 2% 0% -3% -44% 0.385 $245,250,068 CMD Cassius Mining Ltd 0% -6% -18% 32% 0.033 $16,586,148 VSR Voltaic Strategic 0% 0% -16% -33% 0.016 $7,729,662 SGQ St George Min Ltd 4% -14% -26% -67% 0.025 $23,724,970 LLO Lion One Metals Ltd 0% -1% -5% -11% 0.895 $13,716,520 PAT Patriot Lithium -16% -25% -42% -71% 0.105 $8,702,142 PL3 Patagonia Lithium 0% 9% -4% 0% 0.125 $6,141,063 BUR Burleyminerals -7% -27% -41% -64% 0.098 $10,846,159 CHR Charger Metals 0% -14% -27% -66% 0.12 $9,290,430 RMX Red Mount Min Ltd 0% 0% 0% -50% 0.003 $8,020,728 DLI Delta Lithium 5% 4% -38% -37% 0.29 $195,750,402 LM1 Leeuwin Metals Ltd 0% -20% -29% 0% 0.1 $4,685,167 ENT Enterprise Metals 0% 0% 0% -60% 0.004 $3,207,884 FIN FIN Resources Ltd -6% -6% -23% 6% 0.017 $11,686,837 DTM Dart Mining NL 0% 0% -18% -74% 0.014 $3,186,115 NIS Nickelsearch -2% 7% -37% -68% 0.046 $10,036,495 EG1 Evergreenlithium 0% 4% -37% 0% 0.12 $6,747,600 MAN Mandrake Res Ltd 0% 0% -7% -23% 0.04 $24,630,397 FBM Future Battery -2% -15% -30% -19% 0.051 $27,755,311 LPM Lithium Plus -10% -10% -39% -39% 0.215 $20,637,168 KOB Kobaresourceslimited 3% 14% 129% -6% 0.16 $16,339,583 EMC Everest Metals Corp 0% -1% -5% -21% 0.076 $12,485,516 LRD Lordresourceslimited 0% 0% -6% -69% 0.059 $2,190,795 IEC Intra Energy Corp 0% -17% -17% -64% 0.0025 $4,151,954 REC Rechargemetals -9% -16% -28% -48% 0.068 $8,351,398 SLM Solismineralsltd 0% -8% -17% 41% 0.12 $9,408,085 AZS Azure Minerals 0% 0% -1% 1039% 3.645 $1,669,593,653 DYM Dynamicmetalslimited 0% 7% 7% -23% 0.15 $5,400,000 TOR Torque Met -10% -3% -16% 6% 0.185 $31,375,972 SBR Sabre Resources -4% -4% -24% -44% 0.025 $9,730,810 ICL Iceni Gold -11% -11% -19% -62% 0.042 $11,588,369 TMX Terrain Minerals 0% 25% 0% -17% 0.005 $7,158,353 MHC Manhattan Corp Ltd 0% -13% -13% -50% 0.0035 $10,279,429 MHK Metalhawk. -10% -5% -33% -44% 0.09 $9,941,445 NKL Nickelxltd 7% 44% 24% -39% 0.046 $3,776,052 TMB Tambourahmetals -6% -9% -30% -24% 0.08 $7,049,930 ANX Anax Metals Ltd 10% 15% -23% -68% 0.023 $10,153,870 PMT Patriotbatterymetals -8% 0% -34% -54% 0.7375 $403,200,128 BM8 Battery Age Minerals 0% -9% -18% -69% 0.155 $14,222,849 L1M Lightning Minerals -6% -11% -39% -58% 0.085 $3,800,256 ADG Adelong Gold Limited 0% 0% 0% -55% 0.005 $3,498,278 TOR Torque Met -10% -3% -16% 6% 0.185 $31,375,972 AL8 Alderan Resource Ltd 0% -13% -30% -56% 0.0035 $3,874,015 OZM Ozaurum Resources -3% -12% -53% -5% 0.071 $11,588,750 FL1 First Lithium Ltd 4% 2% -48% 50% 0.27 $18,213,433 PLN Pioneer Lithium -9% -6% -20% 0% 0.16 $4,974,375 WYX Western Yilgarn NL 0% 1% -11% -15% 0.089 $4,419,518 RDN Raiden Resources Ltd -4% 0% -38% 339% 0.025 $69,070,693 PFE Panteraminerals 0% 18% 12% -57% 0.058 $7,692,108 GRE Greentechmetals -6% -6% -50% 92% 0.23 $19,789,276 OLY Olympio Metals Ltd -12% -22% -43% -64% 0.06 $4,324,766 SUM Summitminerals 4% -20% -25% -45% 0.074 $3,383,656 JBY James Bay Minerals -5% -13% -44% 0% 0.175 $6,002,325 SCN Scorpion Minerals 0% -11% -24% -71% 0.025 $10,236,405 JNO Juno -6% -11% -23% -18% 0.085 $16,375,073 CC9 Chariot Corporation -8% 13% -29% 0% 0.385 $34,182,270 OBM Ora Banda Mining Ltd 0% 2% -8% 153% 0.22 $375,489,371 RON Roninresourcesltd 0% -10% -24% -13% 0.14 $5,155,501 CXB0 ASRA MINERALS LTD. 0% 0% -25% -63% 0.00003 $4,909,487 ASR Asra Minerals Ltd 20% 0% -14% -57% 0.006 $8,182,479 PFE Panteraminerals 0% 18% 12% -57% 0.058 $7,692,108 TG6 Tgmetalslimited -2% -2% -36% 123% 0.245 $13,521,542 HAW Hawthorn Resources 2% -1% 4% -3% 0.097 $31,826,483 KM1 Kalimetalslimited 2% -10% 0% 0% 0.47 $35,117,364 AEV Avenira Limited 9% 9% -8% -29% 0.012 $23,887,287

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Monday: CHARGED

Catalina Resources (ASX:CTN) +25%

Asra Minerals (ASX:ASR) +20%

Golden State Mining (ASX:GSM) +18%

Wednesday: RUNNING LOW

Kula Gold (ASX:KGD) -33%

Lodestar Minerals (ASX:LSR) -20%

Morella Mining (ASX:1MC) -20%

X factoring

Some other lithium-related takes we’ve noticed around the traps today on Elon Musk’s social platform…

$GLN.ax is very pleased to announce that it is undertaking an equity raising of A$19.5 million having secured firm commitments of A$18.0 million to institutional, sophisticated and professional investors