Fundamental Research Corp.'s Head of Research Sid Rajeev, B.Tech, CFA, MBA and Equity Analyst Nina Rose Coderis, BSc (Geology) commented in a July 13 research note that Argentina Lithium & Energy Corp. (LIT:TSX.V; PNXLF:OTC; OAY3:FSE) may be "on the cusp of a potential discovery in Argentina."
The analysts noted that Argentina Lithium owns significant interests in four early-stage lithium properties in Argentina. These underexplored assets encompass 69,000 hectares (ha) across four salars (salt-encrusted depressions or lakes) in Argentina. The analysts stated that investors presently have a robust appetite for electric vehicle (EV) metals and pointed out that the area known as the "Lithium Triangle", which includes Argentina, Chile and Bolivia is home to 60% of the world's known lithium reserves.
Key Points Worth Noting
- Fundamental Research said it is initiating coverage on Argentina Lithium & Energy Corp with a "BUY" rating.
- The research firm indicated that the company's shares are currently trading at approximately 50% of its fair value and trade at about CA$215/ha compared to an average of CA$524/ha for its pre-resource stage junior peers.
- Lithium prices are up 340% year-over-year due to robust demand, supply disruptions and inflation.
- Drill results at its Rincon West project are forthcoming and offer a positive potential catalyst.
- M&A activity is increasing in the sector which bodes well for the company as miners and battery manufacturers continue to seek out attractive lithium projects for acquisition in order to secure stable and long-term supplies.
- A maiden resource estimate is expected to be completed sometime next year.
Analyst's Research Highlights
- Argentina currently ranks fourth globally in production of lithium and ranks third worldwide in total reserve-base behind only Chile and Australia.
- The first hole of its ongoing five-hole drill program at the company's Rincon West Project returned promising results with values measuring 225-380 mg/L.
- The analysts stated that developing the properties and evaluating the total scope of the four projects resources should continue at a good clip since the process of delineating a lithium resource is quicker and much less costly than similar assessments for mainstream metals such as copper and gold.
- To date, none of Argentina Lithium's properties have a NI 43-101 compliant resource estimate.
Argentina Lithium & Energy Corp. is based in Vancouver, B.C. and concentrates its efforts on acquiring and advancing high quality lithium projects in Argentina towards production. The firm's strategy is highly focused on meeting increasing global demand from the battery sector. The firm's projects are centered in what is known as the "Lithium Triangle," which is an area of where Argentina, Chile and Bolivia come together that hosts around 60% of global lithium reserves.
Fundamental Research Corp. advised that it is initiating a "Buy" rating on Argentina Lithium & Energy Corp. The research firm indicated that it estimates the fair value of the company at CA$0.52/share and stated that it arrived at that value by applying a rate of $524/ha to LIT's land package.
Argentina Lithium & Energy Corp. shares trade on the TSX Venture Exchange under the symbol "LIT" and last closed for trading at CA$0.26 on Friday, July 15, 2022. Find out more about this company on Streetwise Reports at the following link.
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Disclosures for Fundamental Research Corp., Argentina Lithium, July 13, 2022
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