S& P 500 hits all time highs U.S.-Japan trade deal optimism
Investing.com - UBS has maintained its bearish stance on lithium stocks, citing persistent market oversupply and depressed spot prices below US$600/t.
The investment bank kept its Sell ratings on IGO, Liontown Resources (ASX:LTR), and Pilbara Minerals with price targets of A$3.60, A$0.50, and A$1.10 per share respectively. UBS maintained a Neutral rating on Mineral Resources with a A$25.70 price target and a Buy rating on Patriot Battery Metals (TSX:PMET) with targets of A$0.33 and C$2.90 per share.
UBS analysts noted that joint venture structures, partner integration, and strong balance sheets have delayed the typical supply response from producers despite weak prices. The bank expects an extended period of low prices until further supply cuts materialize.
The outlook suggests the lithium market "needs to get worse before it gets better," according to UBS, which believes consensus pricing estimates and equity valuations remain too high. The bank’s forecasts remain largely unchanged as it maintains an underweight position in the sector.
UBS indicated that upcoming fiscal year 2026 guidance from companies might provide more clarity on the path forward for some lithium producers, though its overall sector view remains cautious.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.