Why Standard Lithium Is Poised To Take Its 600% Gain Even Further

In light of the latest announcement by the City of Paris to ban all petroleum-powered vehicles by 2030, the future for electric vehicles just gets brighter and brighter. This is not only good for electric car makers, it also provides a valuable opportunity for producers of lithium – a major component used in electric car batteries.

Standard Lithium

One of the lithium explorers bound to become a leader of the industry is Standard Lithium Ltd (TSX-V:$SLL)(OTCQX:$STLHF), an emerging Canadian Lithium junior mining company that has outperformed many of its junior mining peers and seen its shares rise by close to an astonishing 600% over the past year – and this is only just the beginning.

Standard Lithium

This type of growth and potential is exactly what investors should be looking at in companies that are severely undervalued but have every chance to have lithium operations that can be measured against those of FMC or Albemarle.

To examine why Standard Lithium was able to garner this kind of enormous growth in a short period of time, we need to consider the following advantages that the company has to offer.

Advantage #1: A Large-Scale Lithium Brine Project In The United States

Standard Lithium is currently focused on the 25,000-acre Bristol Dry Lake lithium brine project in the Mojave region of California. The aim is to develop this project into the second operating lithium brine processing asset in the U.S., after Albemarle’s Silver Peak operation in Nevada.

Standard Lithium

So far, we can explore a few illustrations of why this project has huge potential:

  • A mining lease agreement with National Chloride Corporation of America, which has mined brines in the area for close to 100 years, reducing the project’s risks and permitting requirements;

  • Positive results from a controlled-source audio-magnetotellurics/magnetotellurics (CSAMT/MT) geophysical survey suggesting that high lithium brine concentrations are located across nearly every inch of the Bristol Lake claim package;

  • Commencement of a resource definition drill program, with National Instrument 43-101 resource estimates expected in the first half of 2018;

  • Testing showed that the raw brine pumped from the near-surface test pit contained an average concentration of 146 mg/L lithium;

  • Access to electric grid, paved roads and established infrastructure.

A key feature of Bristol Lake is that the low resistivity values measured on the project are very similar to those located in the lithium hotbed known as the Lithium Triangle (Chile, Argentina and Bolivia), and the project itself is located in a less risky geographical location.

Advantage #2: A Renowned And Experienced Management Team

Robert (Bob) Cross, the company’s co-founder and largest shareholder, is a mining “legend” who has made a career of identifying projects with blue-sky potential, accumulating stocks at rock-bottom prices and then growing these companies into major players in their industries.

  • In 2003, Mr. Cross acquired control of Northern Orion Resources, and its market cap grew from under $20 million to $1.4 billion when it was sold to Yamana in 2007.

  • Mr. Cross was co-founder and non-executive chairman of Bankers Petroleum Ltd, which began trading at $0.43 and went as high $9.64, providing shareholders a return of up to 1,995%.

  • Mr. Cross is also a co-founder and non-executive chairman of B2Gold Corp, which began trading at $0.30 and went as high as $4.30, providing shareholders a return of up to 1,333%.

  • He was also a director of Athabasca Potash, until it was bought out for $8.35 a share by BHP Billiton.

The company is also led by CEO and director Robert Mintak, one of the founders of Pure Energy Minerals. Mr. Mintak has considerable experiences with lithium projects and was instrumental in negotiating one of the first conditional lithium supply agreements with Tesla for the Gigafactory. Under his leadership, Pure Energy was recognized as the top mining company in the 2016 TSX Venture 50.

In June, the company also appointed lithium brine expert Dr. Andy Robinson, who previously served as a director for Pure Energy, as the company’s president and COO. Dr. Robinson is known as having compiled North America’s first NI 43-101-compliant resource estimate for a lithium brine deposit.

Advantage #3: Additional Promising Projects To Complement Bristol Dry Lake

In August, the company entered a memorandum of understanding with an NYSE-listed company for an option to acquire certain brine exploration and lithium extraction rights on approximately 30,000 net acres overlying the Smackover formation in a region with a long history of commercial-scale brine processing.

Smackover oil field brines are metal-rich brine anomalies in reservoir rocks along the Gulf Coast from eastern Texas to Florida known to be a prime lithium resource. The Smackover brines have been exploited for bromine by numerous chemical companies over the years and are currently one of the largest source of bromine in the world, accounting for 40% of world production. Lithium is present in abnormally high concentrations in salt brines of the Smackover formation.

Albemarle, the world’s largest lithium producer and operator of the world’s largest bromine-manufacturing operations, previously announced plans to separate lithium carbonate from Smackover brines. This resource may be one of the most promising ones to develop, given that a large-scale brine extraction, processing and reinjection industry is already well established.

Donald E. Garret, author of the Lithium Handbook, estimates that the Smackover is one of the world’s largest lithium brine reserves and contains one million tonnes of lithium metal.

Advantage #4: Lithium Prices Approaching Record Highs

Lastly, many experts are predicting that the price of lithium will reach new all-time highs partly due to the scarcity of lithium carbonate in the global market. Credit Suisse estimates that the global shortfall of lithium could reach nearly 150,000 metric tonnes by 2025.

Additionally, the electric car revolution is continuously “driving” up demand and thus price for lithium. According to Morningstar, lithium demand is set to increase by 16% per year for the next decade, quadrupling by 2025 to 750,000 tonnes. The prices for lithium carbonate have more than doubled since 2015.

Standard Lithium

Backing this in-demand metal is BlackRock, the world’s largest asset manager. The BlackRock World Mining Trust, which has more than £800 million in assets, is the largest shareholder in a handful of small mining companies aiming to produce lithium for use in batteries.

Thus, Standard Lithium is poised to take its gains even further as it moves forward with the Bristol Dry Lake project and the market for lithium continues its upswing.


A Closer Look At Standard Lithium’s Stock

For the past week alone, the company’s shares went up from $1.60 per share to $2.08 per share, a new 52-week high. The share price also more than doubled in just three months.

Standard Lithium

When looking at its price chart, there are several indications that Standard Lithium’s shares are a good buy:

 

  1. Looking at the moving averages, the 200-day moving average line has been on an uptrend, showing a signal that the market is very strong.

  2. Moreover, the company’s shares have been trading above the 50-day moving average line for almost two months, signalling a bullish market and giving investors an indication of the possible support levels.

  3. The diverging Bollinger bands also give a signal that Standard Lithium’s share price is on an upward trend, as the price tends to move with the middle band.

  4. The Relative Strength Index (RSI) indicates the stock is moving out of overbought territory, and another upward trend is possible moving forward.

  5. The candlestick patterns show a potential for a price rally following a decline from the stock’s all-time high: a doji candlestick (October 17) after a big share price drop is a good indication that selling pressure is waning.

Moreover, the company’s stock currently has a beta value of 0.22, meaning that its shares have low volatility and low openness to risk.

In terms of the company’s financial health and valuation:

  1. Standard Lithium’s balance sheet currently shows a current ratio (current assets/current liabilities) of 29.19. As a result, the company is more than capable to paying off its obligation if needed.

  2. Standard Lithium’s price-to-book ratio (P/B) is at 4.9, compared with an industry average of 1.9. A high ratio shows that investors are expecting higher future gains from the company and are willing to pay a premium for its stock.

Standard Lithium’s Growth Is Just The Beginning

All in all, it is hard to ignore a high-growth company like Standard Lithium that has:

  • Strong technicals and high share price upside;

  • A large-scale lithium brine project in a low-risk jurisdiction;

  • Diversified operations across the U.S.;

  • A proven and experienced management team;

  • A double-digit growth in demand for its products over the next decade and beyond.

In terms of share price, Standard Lithium Ltd (TSX-V:$SLL)(OTCQX:$STLHF) is still at a seriously undervalued stage; it will not just stop at the near 600% gain it experienced for the past year. The company has every opportunity to post solid growth for years to come.

Please See Disclaimer

Subscribe & Get Press Releases From Standard Lithium

The Competition For Lithium Is Heating Up. Don't Miss Out!

indicates required
  • phantom stratocaster

    captain we need more dilthiium crystals ,the emgines cant take it

With over five years of banking experience, Ian Lee provides high-level and well-researched financial content. He specializes in writing investment-based, informational pieces. Ian Lee attended the University of Texas, Austin from 2006 to 2010 and holds a Bachelor's of Business Administration.
IMPORTANT NOTICE AND DISCLAIMER: This stock profile should be viewed as a paid advertisement. The publisher, Coinbit Blockchain Solutions Inc., understands that in an effort to enhance public awareness of Standard Lithium Ltd. Inc. and its securities through the distribution of this advertisement. This Advertorial was paid for by 3rd party., in an effort to enhance public awareness of Standard Lithium Ltd. Inc. and its securities. Coinbit Blockchain Solutions Inc. has or expects to receive one hundred sixty-thousand dollars from a 3rd party. All content, ad creatives and designs were previously approved by Standard Lithium Ltd. Inc. If successful, this advertisement will increase investor and market awareness, which may result in increased numbers of shareholders owning and trading the common stock of Standard Lithium Ltd. Inc., increased trading volumes, and possibly increased share price of the common stock of Standard Lithium Ltd. Inc. This publication is not, and should not be construed to be, an offer to sell or a solicitation of an offer to buy any security. This publication, its publisher, and its editor do not purport to provide a complete analysis of any company’s financial position. The publisher and editor are not, and do not purport to be, broker-dealers or registered investment advisors. Any investment should be made only after consulting a professional investment advisor and only after reviewing the financial statements and other pertinent corporate information about the company. Further, readers are advised to read and carefully consider the Risk Factors identified and discussed in the advertised company’s SEC filings. Investing in securities, particularly micro cap securities such as Standard Lithium Ltd. Inc., is speculative and carries a high degree of risk. Past performance does not guarantee future results. This publication is based exclusively on information generally available to the public and does not contain any material, non-public information. The information on which it is based is believed to be reliable. Nevertheless, the publisher cannot guarantee the accuracy or completeness of the information. The publisher conducts little or no due diligence on the profiles that are received by it’s advertisers. The information we disseminate about issuers contain forward looking statements, i.e. statements or discussions that constitute predictions, expectations, beliefs, plans, estimates, projections as indicated by such words as “expects”, “will”, “anticipates”, “estimates; therefore, you should proceed with extreme caution in relying upon such statements and conduct a full investigation into any such forward looking statements. Forward looking statements are limited to the time period in which they are made and we do not undertake to update forward looking statements that may change at anytime. The publisher notes that statements contained herein that look forward in time, which include everything other than historical information, involve risks and uncertainties that may affect the company’s actual results of operations. Factors that could cause actual results to differ include the size and growth of the market for the company’s products and services, the company’s ability to fund its capital requirements in the near term and long term and pricing pressures. Many of the penny stocks that are profiled or provide information have low trading volume, which may lead to difficulties in selling your securities. Many penny stocks profiled or provide information about are subject to intense competition, extreme regulatory oversight and inadequate financing to pursue their operational plan. The issuer profiles and information we provide represent only a small or even infinitesimal amount of information regarding the issuer and is insufficient to formulate an investment decision; as such, that information should only be a starting point from which you conduct an in-depth investigation of the issuer from available public sources, such as www.sec.gov, www otcmarkets.com, www.sec.gov, tsx.com, finance.yahoo.com, www.google.com and other available public sources as well as consulting with your financial professional, investment adviser, registered representative with a registered securities broker-dealer. We urge you to conduct an in-depth investigation of the issuer from the above or other available sources, especially because we only present positive information, which is an insufficient basis to invest in any stock, yet alone a penny stock; accordingly, you should proceed with such investigation to determine, among other things, information pertaining to the issuer’s financial condition, operations, business model, and risks involved in the issuer’s business. The issuers we profile may have negative signs on the otcmarkets.com website (i.e. Stop Sign, No Information, Limited Information, Caveat Emptor), which you should determine from entering the symbol of the stock profiled into the otcmarkets.com website. You should determine whether the issuer we profile or provide information about is a development stage company, which is subject to the risks of a development stage company in a similar such business, including difficulties in obtaining financing for operations and future growth. You should conduct an investigation of the innumerable risks that are inherent or present in the business plan of almost any penny stock issuer; therefore, do not use our profiles or any information contained in our website or profiles as the sole determination of making an investment decision. We only present positive information regarding an issuer; therefore, you should conduct an in-depth investigation of any possible negative factors regarding such issuer. You should accept our information in an “as is” state; in other words, your use of the information is at your own risk and such information may change at anytime and it is not based upon any verification or due diligence of the statements made. Directors, Officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article. Coinbit Blockchain Solutions Inc. and other trademarks and copyrights used in this publication are the property of their respective trademark and copyright holders. Coinbit Blockchain Solutions Inc. is not affiliated, connected, or associated with, and are not sponsored, approved, or originated by, the trademark holders unless otherwise stated. No claim is made by Coinbit Blockchain Solutions Inc. any third-party trademarks or copyrights.