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H.C. Wainwright lowered its price target on Electra Battery Materials Corp. (NASDAQ:ELBM) to $2.20 from $2.40 on Wednesday, while maintaining a Buy rating on the stock. According to InvestingPro data, analyst targets range from $2.15 to $2.55, despite the stock’s challenging performance, having declined over 32% in the past six months.
The adjustment follows Electra’s June 5 announcement that it completed a feasibility level engineering study for a modular battery recycling facility planned near its cobalt sulfate refinery. The facility will recover lithium, nickel, cobalt, manganese, and graphite from lithium-ion battery manufacturing scrap and end-of-life batteries. InvestingPro analysis indicates the company faces financial challenges, with a weak overall health score of 1.67 and a concerning current ratio of 0.06, suggesting potential liquidity constraints.
The recycling operation will utilize Electra’s proprietary hydrometallurgical process, which was developed and validated during a year-long pilot program treating black mass from an industry partner. The process is designed to recover cobalt before sending it to the company’s cobalt sulfate refinery.
H.C. Wainwright expects this development to bring Electra closer to creating a closed-loop system that could play a key role in the North American battery market. The firm noted that Electra may expand its use cases in the longer term and potentially attract more interest as other recoverable battery materials are returned to the supply chain.
The next steps for Electra involve testing the recycling process by running it to simulate commercial-scale production, according to H.C. Wainwright’s research note. InvestingPro subscribers have access to 10 additional key insights about ELBM, including detailed analysis of its cash flow and profitability metrics, which are crucial for understanding the company’s path to commercialization.
In other recent news, Electra Battery Materials Corporation has successfully raised approximately $3.08 million through a private placement, which was oversubscribed and supported by company insiders, including CEO Trent (NSE:TREN) Mell. This funding will advance Electra’s refinery project in Temiskaming Shores, Ontario, and cover general corporate expenses. The company also announced a full subscription for its recent offering, reflecting strong investor confidence in its strategy to strengthen the North American critical minerals supply chain. Additionally, Electra received a Letter of Intent for $20 million aimed at completing North America’s first battery-grade cobalt refinery, which is expected to support the production of up to one million electric vehicles annually. The Canadian government has shown interest in this project, emphasizing its importance for energy security and reducing reliance on foreign sources. Furthermore, H.C. Wainwright analysts have maintained a Buy rating with a $2.40 price target for Electra, following a significant agreement to defer interest payments on its senior-secured debt until 2027. This financial arrangement is anticipated to provide Electra with the flexibility needed to focus on completing its cobalt refinery project. Electra’s broader strategy includes potential expansions in nickel refining and battery recycling, aligning with its vision to enhance the North American EV supply chain.
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