LIBERTY ONE LITHIU COM NPV (OTCMKTS:LRTTF) is a perfect example of a dynamic we have been focused on quite a bit of late: the resurgence of the lithium theme. As we have noted, this is now a big momentum trend once again. And shareholders of LRTTF are reaping the benefits of that momentum right now, with shares of the stock rocketing higher to the tune of about 150% in less than a month, with the lion’s share of those gains coming in just the past two days on no obvious new catalyst.
The Wall Street Journal did a piece showing that the mainstream popularity of electric cars will likely reduce gasoline demand by 5% to 20% over the next two decades, assuming that EVs gain more than 35% market share by 2035. But, for the average investor, it’s extremely difficult to find a play on that boom. And that’s where moves like this one in LRTTF have their roots: there are only a few plays on a big theme, so the money piles in when the theme is hot.
LIBERTY ONE LITHIU COM NPV (OTCMKTS:LRTTF) bills itself as a company that is an emerging exploration player focused on the acquisition and development of high grade lithium brine deposits destined for use by global business interests. The Company believes that strategic resource access is the key to a robust energy strategy to protect economic stability worldwide.
Moreover, LRTTF engages in the acquisition, exploration and development of mining properties in Canada and the United States. The company primarily explores for lithium brine deposits. It holds interests in the Paradox North property with 233 placer claims covering 4,480 acres located in the Paradox Basin in Grand County, Utah, as well as an option to earn a 70% interest in the Pocitos West project covering 15,857 hectares located in Salta Province, Argentina.
According to company materials, “Liberty One Lithium Corp. is an emerging exploration company focused on the acquisition and development of high-grade lithium brine deposits. The Company believes that strategic global resources are the key to a robust energy strategy to protect economic stability worldwide.”
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As noted above, market predictions about a boom in the lithium market are old news, sort of. In fact, every trend such as this goes through periods of doubt and belief, just like anything else. That’s how trends are maintained. In this case, the periods of belief (and perhaps, investor marketing) can be dramatic because the total float of publicly traded shares for the whole of the lithium investment space is very limited.
In addition, analysts are starting to project that market consumption of Lithium could triple from 160,000 metric tons to a staggering 470,000 metric tons by 2025.
In this case, LRTTF appears to have a foothold on the Argentinian production market and has a team in place ready to push the issue.
Mr. Nichol, CEO, notes, “The team in Argentina has once again demonstrated their proficiency and expertise. Not only did they receive the necessary permits without any issues, they also successfully completed the analysis of the previously announced Vertical Electrical Soundings (“VES”) survey enabling us to choose some excellent drilling targets. I cannot understate the importance of having an experienced team in the field.” Nichol adds, “Almost all of the drilling equipment is prepared and ready to mobilize and, if all goes well, we expect to have the initial drilling concluded in time for Christmas. The VES survey suggested that we have a thick, extensive and contiguous brine horizon; the objective now is to drill to determine the quality and lithium content within that reservoir. Drilling these holes is a very exciting milestone for the Company.”
Currently trading at a market capitalization of $56M, LRTTF has virtually no cash on the books, which must be weighed relative to virtually no total current liabilities. LRTTF is pulling in trailing 12-month revenues of $34K. However, the company is seeing declines on the top-line on a quarterly y/y basis, with revenues falling at -53.5%. As more color becomes clear on the name, we will review the situation and update our take. Sign-up for continuing coverage on shares of $LRTTF stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: we hold no position in $LRTTF, either long or short, and we have not been compensated for this article.