Traders take note ✏️, time to dig in a little deeper |
*Sponsored by American Lithium Corp, please see disclosures below |
Good morning, Jeff Bishop here! |
You may not have noticed this, but lithium stocks are back in focus lately 🔎. |
I think a big driver of this is the enormous consumption of lithium that is required by electric vehicle (EV) manufacturers. |
That growing demand is placing pressure on producers, and the biggest players are trying to defend their turf by attempting to snatch up smaller companies in the sector. |
And so far, they haven't been very successful at it. |
I just saw two recent takeovers flat out rejected by the takeover targets, even when offered over $3 BILLION, as you can see from a recent article in the Wall Street Journal. |
Liontown Rejects $3.68 Billion Approach by Lithium Giant Albemarle |
The reason is simply that the "smart money" behind these companies knows the true value of the assets, and they are not going to sell for "pennies on the dollar." |
Liontown defended their position by stating, "The latest proposal was opportunistic and coincided with recent softness in lithium-sector valuations, It also fails to fully recognize the potential of [our various projects.]" |
Then, shortly after that we saw another sizeable lithium company reject a buyout attempt… |
Alpha Lithium rejects buyout bid by Tecpetrol |
What is it that these large producers see that shareholders of the target companies are missing? |
I think the shareholders and short-term focused and missing the bigger picture when it comes to these valuable assets. |
Companies with large, high-grade, low-impurity and low-cost deposits located in safe jurisdictions I think should always command a premium. |
Just like the company I want you to revisit today: |
American Lithium Corp. |
(Nasdaq: AMLI and TSX: LI) |
It's not enough that this is once again a hot sector, ripe with merger activity. |
No, I am looking squarely at the technical indicators on the price chart right now. |
If you ignore a powerful "gamma trigger" move like we are seeing with AMLI right now, then you are missing a huge opportunity (you can read in depth about the stock here). |
After investors took AMLI off their radar during the slow summer months, it looks like they have returned this week – and with a big appetite! |
Just look at how AMLI has performed the first two days of this week… |
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The stock has made a 28% move higher and it is now sitting above the key 200-hour moving average. |
This is one of my absolute favorite trading setups – and it is happening right before our eyes! |
By the way, I am going to interview "Mr. Lithium", Andy Bowering TODAY, Wednesday Aug 30th @ 2:30pm EST. Bring your questions for him! |
Simply click this link to join us live (no download needed). |
You see, countries and corporations around the world have agreed: |
Gas and gas-powered cars must go the way of the dinosaur 🦕. |
With several hottest temperature records smashed around the world this summer, the climate, global boiling, whatever you want to call it – is back on the front pages. |
· The highest average worldwide temperature ever recorded was broken just earlier this July… |
And as part of this, with major Government backing… |
Electric Vehicles (EVs) have a massive role to play in the transition towards a carbon-free net zero future. |
Looking ahead to the end of the decade and beyond, electric vehicles are expected to claim the lion's share of new car sales: |
However, there's another powerful new driving force in America's transition to electric vehicles and clean energy: the U.S. "Battery Belt." |
Stretching from Michigan to Tennessee, Georgia, and western New York, this region is rapidly becoming the heart of domestic battery production: |
· Since 2021, significant investments have been pouring into the Battery Belt, fueling the construction of massive battery factories known as gigafactories. |
The rapid development of these facilities is essential for the United States to produce more lithium-ion batteries, the lifeblood of electric vehicles and energy storage systems. |
Lithium is a critical ingredient in these batteries and is in high demand. |
And the U.S. "Battery Belt" is helping the country tap into its own considerable reserves instead of relying on foreign imports. |
· As the appetite for EVs and energy storage surges, experts predict a remarkable five-fold increase in U.S. lithium-ion battery production from 2021 to 2026. |
· By 2031, they expect an astounding 86% further growth in battery output compared to 2026. |
A gigafactory with a capacity of 1 gigawatt hour (GWh) per year can put 10,000 to 20,000 electric cars on the road each year. |
And all the new planned battery gigafactories are expected to rocket North America's battery manufacturing capacity by 2030. |
That's a whole lotta EVs! |
Building Out the Battery Belt |
The Battery Belt is a great place for battery gigafactories because it's close to car manufacturers and has good roads, power supplies, and water sources. |
Transporting lithium-ion batteries is expensive because they're considered hazardous materials and need to follow special safety rules. |
Making them in the U.S. closer to the car factories saves money and makes the whole process easier. |
Big car companies like Ford and GM are spending a lot of money to make more EVs and batteries. Ford is investing $50 billion through 2026, and GM will spend $35 billion by 2025. |
GM is working with another company, LG, to build three big battery factories in the U.S., and they're even getting help from the government with a $2.5 billion loan. |
In short, the U.S. Battery Belt has an important role to play in America's future. It'll help meet the growing demand for batteries, kickstart domestic production to make the country less dependent on foreign lithium, and make things easier for car companies. |
As the U.S. continues to focus on electric cars and clean energy, the Battery Belt will play a big role in making that happen. |
5 Explosive Factors Driving the Lithium Market over the next 12-24 months: |
Already massive investment in gigafactories:
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Since the beginning of 2021, over 15 new U.S. lithium-ion battery gigafactories or expansions have been announced, representing a potential investment of at least $40 billion. |
This rapid growth in gigafactory infrastructure demonstrates the United States' commitment to becoming a leader in the EV and renewable energy sectors. |
Impressive future growth in battery production capacity:
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According to Benchmark Mineral Intelligence, U.S. lithium-ion battery capacity is expected to grow more than fivefold from 2021 to 2026. |
By 2031, the capacity is anticipated to expand by another 86%. This trajectory represents 18x growth in domestic battery manufacturing capacity from 2021 to the end of the decade and underlines the significance of the Battery Belt for the domestic lithium market. |
Strategic locations of gigafactories:
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The Battery Belt gigafactories are primarily located in the Midwest and South, as well as near Tesla facilities in California and Texas. These strategic locations were chosen to be near automakers, as transporting large quantities of lithium-ion batteries is expensive and subject to strict safety regulations. |
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The gigafactory investments not only support the lithium and EV industries but also create thousands of well-paid jobs. On top of this, these factories will spur further investment in domestic lithium mining as well, leading to even more job creation. |
Automaker investments driving demand:
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Major automakers are investing heavily in electric vehicle production, further fueling the growth of the Battery Belt. Ford plans to spend $50 billion through 2026 to expand EV production, while General Motors is investing $35 billion through 2025. These substantial investments indicate the high demand for lithium-ion batteries and the crucial role the Battery Belt plays in meeting this demand. |
As always, make sure you do your own due diligence on any investment you decide to make. Only you can decide if it is right for your particular investment profile. |
I think that right now, we are seeing a perfect storm for anyone interested in lithium. |
Especially if you're a proactive investor. |
Click here to get the full breakdown on AMLI |
Regards, |
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P.S. Make sure you text "RAGE" to (888) 404-5747 to get all of my latest HOT STOCK ideas! |
*This investment involves substantial risk. Please see full disclosure below, and detailed discussion of risks and atypical results. |
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