Are you looking for a hidden gem in the commodities space that has potential for growth? Look no further than SQM, the Latin American lithium producer that is catching the eye of analysts at Jefferies. Despite facing some challenges this year, Jefferies analyst Alejandro Demichelis sees SQM as an attractively valued play with significant upside potential.
In a recent note to clients, Demichelis upgraded U.S. shares of SQM to buy from hold and raised the price target to $62.80, implying a 31.9% upside. He highlighted the company’s low-cash cost advantage in the lithium space and its expanding international presence as key factors that the market may be overlooking.
While SQM has been trading in line with its peer Albemarle, there are some uncertainties surrounding a deal to extend a Chilean lithium concession. However, Demichelis believes that once executed, this deal could create value for the company and put it in a stronger competitive position in the long term.
Despite the stock market’s volatility this year, SQM shares have shown resilience, advancing over 6% during Monday morning trading. With a potential for growth and a strong competitive footing in the lithium space, SQM is definitely a stock to watch.
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