Lithium Americas' Thacker Pass Is Under Construction at one of the World's Largest Lithium Resources

Strategist

Seth Goldstein

Gross Profit, Operating Income, and Net Income as a percentage of Revenue

Gross Margin

Operating Margin

Profit Margin

Margins

An operating expense is an expense a business incurs through its normal business operations. Often abbreviated as OPEX.

Exploration and evaluation expenditures

General and administrative expenses

Equity compensation

Organoclay research and development

Operating Expenses

Year over year growth in Revenue and Operating Expenses.

Revenue Y/Y

OpEx Y/Y

Growth

Shares outstanding refer to a company's stock currently held by all its shareholders, including share blocks held by institutional investors and restricted shares owned by the company's officers and insiders.

Outstanding Shares

Market Cap

Also known as Price/Sales Ratio. Calculated using Average market cap for the quarter / Annualized quarterly revenue.

Revenue Multiple

Lithium Americas aims to become a pure-play lithium producer. The company was created as a result of the former Lithium Americas separation, which separated the firm's North America business, which is the current Lithium Americas, from its Argentina business, which was named Lithium Argentina.

Lithium Americas' only resource is the Thacker Pass lithium project in the U.S. state of Nevada. Thacker Pass is currently in construction, with plans to enter production later in the decade.

Upon entering production, Thacker Pass would become the first clay-based lithium resource in the world. Historically, all lithium production has come from either brine or spodumene. Spodumene assets, which are prevalent in Australia, is a mining procedure where spodumene is mined, treated, and refined to produce a lithium product. Although new, Thacker Pass’ clay-based operation will more closely replicate that of spodumene mining. Alternatively, brine, which is prevalent in South America, is pumped from an underground aquifer above ground into evaporation ponds, which over time is concentrated into a lithium-rich salt. This salt is then processed into a lithium chemical at a downstream conversion plant.

Thacker Pass is set to be a large-scale lithium production site. Management targets 80,000 metric tons of annual capacity from its first two phases. However, the McDermitt Caldera resource, where Thacker Pass is being constructed, is one of the largest known lithium resources globally, and we see opportunity for further capacity additions. We estimate the asset can build out to a total 240,000 metric tons of lithium capacity per year.

As electric vehicle adoption increases, we expect maintained double-digit annual growth for lithium demand. Lithium Americas should benefit as there should be more than enough demand for company’s three resources to enter production and expand capacity over time.

Aside from the Thacker Pass project, Lithium Americas also owns small equity stakes in Green Technology Metals, a company that is developing two spodumene projects in Ontario, Canada, and Ascend Elements, a company that is developing battery recycling technology.

Business Strategy & Outlook

We assign Lithium Americas a no-moat rating. The firm’s only asset, Thacker Pass, is currently in construction, and we estimate the firm enter production, albeit marginally, in 2026.

Globally, lithium has been produced from either the evaporation of brine or the mining of hard rock minerals (spodumene or lepidolite). In general, lithium carbonate production via brine, which is prominent is Chile and Argentina, costs less than that of spodumene production, which is prevalent in Australia, and far less than lepidolite, which is produced in China.

With Thacker Pass, Lithium Americas aims to introduce a new type of lithium resource, clay mining, which will more closely replicate hard rock-based production. Global lithium demand has quickly been ramping over the last several years given EV adoption, but historically, the lithium market was relatively small. New greenfield projects weren’t needed to supply the market, with brownfield investment being enough to meet demand growth. However, we estimate global lithium demand will more than triple by 2030 to 2.5 million tons, well above the roughly 800,000 metric tons in 2022. As such, new greenfield projects will be required to supply the market, including new methods of lithium extraction, such as clay-based mining.

Thacker Pass is located in the McDermitt caldera mountain range in northwest Nevada. Based on management’s recent technical studies, the caldera is one of the largest rock-based lithium resources in the world. Additionally, Lithium Americas has only surveyed the area necessary for its two planned stages, which will ramp to 80,000 metric tons of annual capacity. Within the current resource estimate, there is room for significant expansion. Lithium Americas also owns land rights to the northern part of the caldera, where there is potential for additional investment in production capacity.

Once the project enters production, Thacker Pass should sit on the bottom half of the lithium carbonate cost curve, and we estimate will be the second lowest rock-based resource globally (behind Albemarle and Tianqi’s Greenbushes asset). As such, Thacker Pass should be profitable on an all-in-sustaining cost basis, which accounts for operating costs, taxes and royalties, and maintenance capital expenditures. Based on economics alone, we estimate the asset to be a relatively low-cost producer on the global cost curve, producing at $7,000 per ton. 

However, our no-moat rating is due to the material threat of value destruction related to project uncertainty. Although project feasibility studies indicate clay-based mining is a viable method for lithium extraction, the project carries additional risk as it is the first of its kind. Thacker Pass is currently in construction and could face material delays and cost overruns that could hurt shareholder returns. Even after construction is finished, we see risk that clay-based mining may ultimately prove to have a materially higher cost than currently forecast, potentially ending up on the higher end of the global cost curve. Given the material threat of value destruction for the project, we view a no-moat rating as appropriate for now but will revisit our rating as the project enters production.

None

Economic Moat

Lithium Americas Corp

Lithium Americas Corp. is a resource company, which engages in lithium development projects. Its projects include: Thacker Pass and Caucharí-Olaroz. The company was founded by Raymond Edward Flood, Jr. on November 27, 2007 and is headquartered in Vancouver, Canada.

Revenue

Cost of revenue

Gross profit

Operating expenses

SG&A

Other

Operating income

EBITDA

Net income

Earnings per share

Total assets

Current assets

Cash & equivalents

Receivables

Inventory

Non-current assets

Net PPE

Intangibles

Total liabilities

Current liabilities

Short term debt

Income tax payable

Non-current liabilities

Long-term debt

Total equity

Stockholders equity

Minority interest

Total liabilities & equity

Total debt

Net debt

Book value per share

Cash from operations

Funds from operations

Change in working capital

Cash from investing

Capital expenditure

Purchase/sale of investments

Purchase/sale of business

Other sources

Cash from financing

Change in stock

Change in debt

Cash dividends paid

Cash from other sources

Net change in cash

Free cash flow

Lithium Americas Corp. owns and operates the Thacker Pass project. It is focused on advancing Thacker Pass to production it is located in northern Nevada. The company is headquartered in Vancouver, Canada.

Is (LAC) Outperforming Other Basic Materials Stocks This Year?

Is Lithium Americas (LAC) Stock Outpacing Its Basic Materials Peers This Year?

Despite its 2021 pullback, this junior lithium miner's stock is up more than 400% over the last year.

Why Lithium Americas Stock Fell 14% in March

Energizer Holdings

Global X Lithium & Battery Tech ETF

Panasonic Holdings Corp

Romeo Power

Sociedad Quimica Y Minera De Chile

Energous

If you're hesitant on the recent volatility of electric vehicles, you should instead consider these relevant battery stocks. The post Grading 7 of the Biggest Battery Stocks as an All-EV Future Looms Larger appeared first on InvestorPlace.

Grading 7 of the Biggest Battery Stocks as an All-EV Future Looms Larger

Albemarle

Volkswagen AG

The U.S. government is going to invest $174 billion into EVs by 2030 via the infrastructure plan. Lithium prices are blasting off, up 88%.

174 Billion Reasons To Invest In Lithium

The miner has two projects, one in Argentina and one in Nevada, that make sound economic sense to B. Riley analyst Lucas Pipes.

Lithium Americas Stock Gets Boost From Wall Street

Amplify Lithium & Battery Technology ETF

Livent Corp

Lithium prices surged higher the past month.

Lithium Miners News For The Month Of March 2021

QuantumScape

Xcel Energy

EV manufacturers aren't the only way to make money off the growth of electric vehicles.

If Electric Vehicles Take Over, These Energy Stocks Will Be Big Winners

Earnings were released yesterday, and analysts chimed in today.

Why Lithium Americas Stock Dropped Wednesday

VANCOUVER, British Columbia, March 02, 2021 (GLOBE NEWSWIRE) -- Lithium Americas Corp. (TSX: LAC) (NYSE: LAC) ("Lithium Americas" or the "Company") has reported financial and operating results for the fourth quarter and year ended December 31, 2020.

Lithium Americas Reports 2020 Full Year and Fourth Quarter Results

Piedmont Lithium

MP Materials

Wall Street analyst sees EVs growing into a $5 trillion industry in 10 years, which could be great news for miners of lithium and the rare earths.

Why Lithium Americas, Piedmont Lithium, and MP Materials Stocks Popped Today

Celestica

Enphase Energy

NextEra Energy

NEW YORK, Feb. 26, 2021 /PRNewswire/ -- Lithium is now a critical metal for Europe. In September 2020, the EU added lithium to its Critical Raw Materials (CRMs) list, warning of the need for a continuous flow of lithium supply for zero-emission mobility. Mentioned in today's commentary...

The 'Oil Of The Future' Is Set To Soar In 2021

Peridot Acquisition Corp.

Lithium prices were up for the past month. Lithium market news - Deutsche Bank sees the lithium market in a deficit from late 2021 out towards 2024, upgrades ALB & SQM.

Lithium Miners News For The Month Of February 2021

These lithium stocks are playing a pivotal role in powering the electric vehicle industry. They are set for major gains in the near future.

7 Lithium Stocks That Are Keeping the EV Revolution Running

With the growth that will outpace EV manufacturers, and more certain futures, I believe that these suppliers are the prime means of capitalizing off of the global transition to EVs. Even as the pandemic has dampened electric vehicle adoption last year, lithium remains a strong market with a ceiling far above its current residence as supply constraints drive prices up.

Invest In EV Suppliers Over Manufacturers

A Wall Street Journal article sets a fire under lithium stocks.

Why Lithium Americas, American Lithium, and Piedmont Lithium Stocks All Popped Today

The Canadian junior lithium miner's stock has continued its 2020 electrifying performance into 2021.

Why Lithium Americas Stock Soared 57% in January

Plug Power

Tesla

EV stocks have been running wild lately. Here are seven battery stocks that are likely to make it easier to invest in this hot segment.

7 Lithium and Battery Stocks for Big Growth

These undervalued lithium stocks could have a multi-year rally on industry tailwinds. The EV industry is a key trigger for lithium demand.

3 Undervalued Lithium Stocks That Could Still Benefit From the EV Craze

The lithium miner has had a news-filled past week, and trading volume has soared.

Why Lithium Americas Stock Dropped 6% Today

Lithium prices were significantly higher for the past month. BMI - "Lithium prices see first sustained rise in 3 years" Lithium market news - Evercore: Lithium demand will treble by 2025. LG signs massive ~$10 billion deal to make batteries in Indonesia. Tesla's record sales drive a battery metals revival.

Lithium Miners News For The Month Of January 2021

Lithium Americas Corp. (LAC) closed the most recent trading day at $23.05, moving -0.77% from the previous trading session.

Lithium Americas Corp. (LAC) Stock Sinks As Market Gains: What You Should Know

Invesco Global Clean Energy Portfolio

Invesco WilderHill Clean Energy ETF

Sunrun

SolarEdge Technologies

Invesco Solar ETF

Green energy ETFs were the top performers in 2019 and 2020; what lies ahead.

Clean Energy ETFs to Keep Soaring in Biden Era

Has Lithium Americas (LAC) Outpaced Other Basic Materials Stocks This Year?

The government has approved LAC's Nevada mine named Thacker Pass. The next catalyst is funding via a partner. This will push the stock higher.

Lithium Americas: Terminus

VANCOUVER, British Columbia, Jan. 22, 2021 (GLOBE NEWSWIRE) -- Lithium Americas Corp. (TSX: LAC) (NYSE: LAC) ("Lithium Americas" or the "Company") announced today the closing of its previously announced underwritten public offering (the “Offering”) of shares of its common stock (the “Common Shares”). The Company issued 18,181,818 Common Shares, including 2,272,727 Common Shares following the exercise in full by the underwriters of their over-allotment option. The shares were issued at a price of US$22.00 per Common Share for gross proceeds to the Company of approximately US$400 million.

News for Lithium Americas Corp Stock (LAC)