Livent Shares Surge On Earnings, Tesla Partnership

Livent Corporation LTHM shares are setting new 52-week highs Friday after announcing earnings, a new joint venture and an expanded partnership with Tesla Inc. TSLA.

Q3 Earnings: Livent reported third-quarter revenue of $72.6 million. This was down from the prior year’s period, but up from the second quarter.

The company said it was a difficult market for the lithium industry in the third quarter.

Livent expects an increase in volumes in the fourth quarter, citing higher year-over-year sales of electric vehicles.

Related Link: Analyzing Livent’s Unusual Options Activity

Joint Venture: Livent and partner The Pallinghurst Group will own 50% of New Nemaska, a joint venture for the business and certain assets of the former Nemaska Lithium. The other 50% will be owned by Investissement Quebec.

“New Nemaska is one of the most attractive lithium projects in the world and is ideally positioned to meet the growing demand for a reliable high-grade supply of lithium chemicals in North America and Europe,” said the company.

Tesla Partnership: Livent also announced it has extended its multi-year lithium hydroxide supply agreement with Tesla. The deal was extended through 2021, with the new agreement a commitment “for higher volumes than in 2020.”

“Livent continues to discuss the framework for a long-term supply partnership with Tesla beyond 2021.”

Benzinga’s Take: Livent is a pure-play lithium supplier that was spun out of FMC Corporation FMC. The extension of the Tesla deal is a good sign and an extension beyond 2021 could be a major catalyst.

Shares of Piedmont Lithium Limited PLL surged on a Tesla supply deal. Shares of Piedmont are up 194% year-to-date.

Shares of Livent hit a new 52-week high of $13.59 on Friday. Shares are trading 11% higher to $13.10 at publication time.