Lithium, lithium, lithium…
It’s all about lithium right now as demand for electric vehicles soars – and as battery prices climb alongside. Existing supply chains can’t keep up, causing prices to increase five-fold. Last January a shipment cost $8,000 a tonne. Now it’s $41,000.
Bad for the car companies. Bad for EV customers.
Hey, everybody. Shah Gilani coming to you on Friday with some Friday BS.H – Buy, Sell, or Hold.
You guys sent in a bunch of cool stocks today, and the predominant theme was lithium, lithium, lithium.
So let’s attack three lithium stocks, and I’m gonna tell you what I think about them.
First up is American Lithium Corp. (OTC: LIACF).
I’m calling this one a buy. It’s trading around $3.25 – thereabouts. I think the stock could come down to $3.00. I’d prefer to buy it at $3.00. I think you have good support there.
And again, this is a company that’s in the development stage of lithium stuff. It doesn’t make any money. The numbers are horrible. You’re not gonna buy it based on any metrics – other than the fact that this stock has seen some pretty nice movement.
So I would like to see this – I’d like to buy this at $3, myself, and ride it higher.
Is it a straight-up play – you wanna own this long term? No, only if it goes in your direction.
This is the kind of play that you want to just take your money and get out if you have a nice, quick pop, and it comes back down.
Otherwise, stick with it as long as it’s got momentum.
On the downside, I’d put a stop in at $2.00. So yeah, that’s a bit of a hit, but that’s below the 200-day moving average – which is around $2.24.
So if you come down to $2.24, you’re at the 200-day moving average. I’d give it a little leeway below that. I’d put my stop in at $2.00.
Is that a bit of a loss to take? Yeah, it is a considerable loss – more than I normally would take, but this is a speculative play.
Buy it around $3.00. Put in a $2.00 stop. See if you can’t ride it to the moon.
Next up: another lithium stock of course.
Alpha Lithium Corp. (OTC: APHLF).
APHLF has a market cap of about $135 million, whereas American Lithium is about an $800 million market cap.
So Alpha Lithium: same kind of a play – purely speculative. It’s trading around 93 cents.
Is it a buy here?
Yeah, I would prefer to buy it at 80 cents – where there’s some support – but you can take a shot here.
I would put a 10% stop on this. Again, if it comes down and you can buy it at 80, I’d put a 10% stop at just below that. And then see if you can’t ride it for a quick pop or two.
This thing trades all over the place. It’s pretty newly minted, and it’s all over the place. It’s extremely volatile.
But again, I like lithium. I want to be in lithium. You guys want to be in lithium because it is the future. We’re already there – it’s only gonna be more and more and more lithium. Demand is already off the charts. It’s never going to recede.
Next up: QuantumScape Corp. (NYSE: QS).
Quantumscape – guess what. It’s in the same business.
A development-stage company – development and commercialization of solid-state lithium-metal batteries.
Yeah, it’s all about lithium today.
So do I like Quantum?
Yes, I do. I would buy QS, really, right here – $21.18. I’d probably put a $19.00 stop in here.
This thing has $10 billion, market cap, and that’s rather steep.
What I like about Quantum is: This stock, trading now at $21.00 and change, was at $72.00 in February last year.
That’s a huge comedown. It’s made a bottom. I think it’s consolidating down here.
I love buying stuff on the cheap. I love lithium. And Quantumscape down here – in the $21+ range – I think it’s a buy.
$19.00 is a pretty reasonable stop. You’re not really risking a whole lot, and it’s got about 247 million shares floating. Of that, almost 16% has been shorted.
What does that mean?
That means we could see the Reddit crowd come in and chase this one higher.
They’re more likely to chase this higher – Quantum – than they’re gonna chase Alpha Lithium or even American Lithium.
Because there’s more action in this stock. It has greater room to go a lot higher.
It’s the kind of stock that the Reddit crowd might go after. It’s in the space that they love, and it’s trading – really – near its lows. So yeah, I like it for that reason too.
Is that a reason to buy a stock long term – hold? Nope.
But it’s certainly a reason to trade a stock.
That’s why – probably – of the three: QS. Buy it around here – $21.00 and change with a $19.00 stop – is an all-day play for me.
That’s it, everybody. Catch you next week.
Thanks for watching. Have a great weekend.