Green is the new black? WWR, SLI stocks jump on Lithium hopes

Highlights

• The Westwater Resources, Inc. (AMEX: WWR) is set to construct its Coosa Graphite Project production facility near Kellyton, Alabama.
  
  
• Westwater’s board of directors has approved US$202 million for the construction, expected to start this year.
  
  
• Standard Lithium Ltd. (AMEX: SLI) receives positive results from the assessment of its Lithium project, likely to produce 30,000 tons of Lithium annually for the next 20 years.

Westwater Resources Inc. (AMEX: WWR) stock surged 10.60%, and Standard Lithium Ltd. (AMEX: SLI) stock rose 10.42% in premarket on Tuesday after sharing upbeat news.

WWR traded at US$3.86, and Standard Lithium Ltd. traded at US$8.90 at 8:13 am ET.

Let’s look at some of their recent developments.

Westwater Resources, Inc.

The Westwater stock rallied after announcing positive results from the “Definitive Feasibility Study” for its Coosa Graphite Project facility to be built near Kellyton, Alabama. 

The company said that its board of directors has approved US$202 million for Phase I construction of the project, expected to start later this year. 

The Alabama facility would purify natural graphite concentrates for battery production. In addition, the company has applied for a patent for the technology and processing technique to be used in extracting and refining graphite concentrates.

Its readymade graphite products will be used in lithium-ion batteries of EVs. Westwater would hire around 100 people for the facility that will start processing activities by early 2023. 

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The Westwater stock traded between US$11.45 and US$3.25 in the last 52 weeks. On Oct 11, it saw a single-day gain of 2.65% to US$3.49, with a share volume of 3,820,825. 

Westwater explores and develops mineral resources for clean energy production. The Colorado-based company hold rights for lithium and uranium production in the US and Turkey. 

It has a market capitalization of US$120.9 million.

The company earned no revenue in the June quarter. Its net loss was US$3.48 million or US$0.11 per share diluted in the June quarter of 2021, compared to a net loss per share diluted of US$0.25 in the year-ago quarter. Its cash and equivalents were US$119 million as of June 30, 2021, compared to US$6.14 million as of June 30, 2020. 

Westwater launched its IPO in 2001. The stock fell 29.21% YTD.

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Source - pixabay

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Standard Lithium Ltd. 

The stock gained traction on Tuesday after announcing positive results from the Preliminary Economic Assessment (PEA) of its Lithium project, formerly called Tetra Project, in Arkansas.

This study estimates around 30,000 tons of battery-quality lithium hydroxide production capacity annually for the next 20 years. It also updated the in-situ resource of 1,195,000 tons of Lithium Carbonate Equivalent in the inferred mineral resources category. 

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The British Columbia, Canada-based company develops lithium brine properties in the US. 

Its market cap is US$1.13 billion. The stock traded in the range of US$9.36 and US$4.64 in the last 52 weeks. On Oct 11, it closed at US$8.06, up 3.87%, with a share volume of 1,169,201.

For the second quarter of 2021, its revenue was US$102 million, and net loss per share from continuing operations was US$0.05. Its cash flow from operating activities was US$1.8 million, and adjusted free cash flow from continuing operations was US$4.5 million.

The stock gave a 240.35% return YTD.

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Bottomline

The shift to a clean energy ecosystem from the traditional oil and gas has made Lithium a key industrial resource, particularly for the battery and the EV industry. Lithium is also extensively used in the electronic equipment industry. Given Lithium’s increased growth potential and demand, the industry is expected to grow manifold in the coming years. However, investors must exercise due diligence before investing in the stock market.