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Highlights
Canadian lithium stocks are gaining traction amid rising demand for clean energy sources. The thing with any renewable energy is that it needs to be stored for consumption. That's when lithium comes in. Lithium is a crucial battery component that enables the storage of wind, solar or hydro energy.
Also read: SLI, SGML, FL, LI & RCK: TSXV lithium stocks to buy for cleaner future
Rising oil and gas prices are another prime reason for higher demand for lithium stocks. On that note, let’s explore some Canadian lithium stocks that have surged higher.
1. Lithium Americas Corp (TSX: LAC)
Lithium Americas Corp is a mid-cap lithium exploration company operating in Caucharí-Olaroz and Pastos Grandes, Argentina and Thacker Pass, US. In January, the mid-cap company acquired Millennial Lithium and a 100 per cent stake in the Pastos Grande project.
Stocks of Lithium Americas catapulted by about 101 per cent in the year. Relative Strength Index (RSI), which signifies a bullish or bearish situation for a stock, surged higher to 40.99 on Friday, May 13, according to Refinitiv.
Also read: H, AQN, CU, NPI, ALA: TSX utility stocks to buy amid recession concerns
2. Sigma Lithium Corporation (TSXV: SGML)
Sigma Lithium Corporation is a small-cap firm that explores lithium properties. It aims to provide high-purity battery-grade lithium for the electric vehicles (EV) market.
SGML stock rocketed by some 228 per cent in a year. The TSXV lithium stock had dropped by around 23 per cent since April 8, when it reached its 52-week high of C$ 24.51. SGML's RSI value was approximately 46 on May 13, according to Refinitiv data.
3. Frontier Lithium Inc (TSXV:FL)
Frontier Lithium revealed its 2022 exploration program and targets, including drills, mapping and prospects for the PAK Lithium Project, located in north western Ontario.
FL scrip galloped by almost 318 per cent in nine months. This lithium scrip was nearly 14 per cent down from its 52-week high of C$ 3.89 (May 5). FL's RSI value stood at 50.36 on May 13, as per Refinitiv.
4. Lithium Energy Exploration Inc (TSXV:LEXI)
Lithium Energy Exploration announced to start its phase one drilling campaign under the joint venture (JV) deal with triangle Lithium Argentina SA in March. The company's CEO Steven Howard believes that 2022 will be a breakout year for Lithium Energy Exploration with higher lithium prices and the rollout of EVs at a larger scale.
LEXI stock shot up by over 15 per cent on May 13 and zoomed by approximately 96 per cent in 12 months. Lexi was still about 30 per cent less from a 52-week high of April 13 and held an RSI value of 48.92, indicating a balanced position.
5. Lithium Chile Inc (TSXV:LITH)
Lithium Chile recently bought further 9,600 hectares at its Laguna Blanca site in Chile. This acquisition added 39 new claims and expanded Lithium Chile's ownership to 14,800 hectares in the basin.
LITH scrip gained by nearly 108 per cent in nine months. This lithium scrip spiked by over 16 per cent in a single day and has an RSI value of 44.64 on May 13, as per Refinitiv.
Bottomline
Lithium is a key battery material that can store and use renewable energy when needed. With increasing electrification in the economy, battery materials like lithium can see increased demand. Hence, adding a lithium stock to your portfolio could widen your exposure to the lithium market.
Some of these stocks are well-known lithium players in the market, while others are rapidly evolving and expanding their lithium operations and could provide notable return in the future in suitable market conditions.
Please note, the above content constitutes a very preliminary observation based on the industry, and is of limited scope without any in-depth fundamental valuation or technical analysis. Any interest in stocks or sectors should be thoroughly evaluated taking into consideration the associated risks.
