Deutsche Bank maintained Lithium Americas(LAC:TSX) with a Buy, and $36 target

STA Research
by: STA Research

Deutsche Bank maintained the Buy rating on Lithium Americas, and keeps the $36 target on the stock.

STA Research reiterated the Buy rating on Lithium Americas, and  with a  $36 target on the stock.

Lithium Americas Corp Stock Analysis:

Based on the Lithium Americas Corp stock forecasts from 10 analysts, the average analyst target price for Lithium Americas Corp is CAD 47.50 over the next 12 months. Lithium Americas Corp’s average analyst rating is Strong Buy. Stock Target Advisor’s own stock analysis of Lithium Americas Corp is Slightly Bearish, which is based on 3 positive signals and 7 negative signals. At the last closing, Lithium Americas Corp’s stock price was CAD 33.59Lithium Americas Corp’s stock price has changed by +1.36% over the past week, -22.37% over the past month and +103.70% over the last year.

What we like:

High market capitalization

This is one of the largest entities in its sector and is among the top quartile. Such companies tend to be more stable.

Superior risk adjusted returns

This stock has performed well, on a risk adjusted basis, compared to its sector peers(for a hold period of at least 12 months) and is in the top quartile.

Positive free cash flow

The company had positive total free cash flow in the most recent four quarters.

What we don’t like:

High volatility

The total returns for this company are volatile and above median for its sector over the past 5 years. Make sure you have the risk tolerance for investing in such stock.

Overpriced compared to earnings

The stock is trading high compared to its peers on a price to earning basis and is above the sector median.

Overpriced compared to book value

The stock is trading high compared to its peers median on a price to book value basis.

Highly leveraged

The company is in the bottom half compared to its sector peers on debt to equity and is highly leveraged. However, do check the news and look at its sector and management statements. Sometimes this is high because the company is trying to grow aggressively.

Negative cashflow

The company had negative total cash flow in the most recent four quarters.

Overpriced on free cash flow basis

The stock is trading high compared to its peers on a price to free cash flow basis. It is priced above the median for its sectors. Proceed with caution if you are considering to buy.

Low Earnings Growth

This stock has shown below median earnings growth in the previous 5 years compared to its sector

 

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