Howard Klein: The Short-term Mentality is Impacting the Lithium Space

Most market watchers would agree that lithium has had an interesting year so far. To get more insight on what’s been happening in the sector, the Investing News Network caught up with Howard Klein, founder of RK Equity and publisher of the Lithium-ion Bull newsletter, at this year’s Cathodes conference.

Klein talked about the recent IPOs in the lithium space, saying that Livent (NYSE:LTHM), a spin-off of FMC (NYSE:FMC), is a company he is bullish on as they are a leader in the hydroxide lithium space.

“I think their IPO was executed well given the market volatility [at the time],” he added.

Speaking about another lithium IPO, Klein said he did not expect Ganfeng (SZSE:002460) to price its IPO at the bottom range of estimations.

“The biggest short-term positive for Ganfeng is that they have the biggest near-term volume growth because their carbonate and hydroxide processing facilities are ready to be commissioned,” he added.

Klein also talked about another top Chinese lithium producer, Tianqi (SZSE:002466), and its purchase of a minority stake in SQM (NYSE:SQM).

“I’ve been strongly against this deal, it makes no sense for a company like Tianqi to significantly reduce its financial flexibility to purchase a minority stake in a company in which it will have no control over,” he said.

Klein also discussed the China-US trade war fears, and how they have impacted the markets, in particular the lithium space.

“More than the relationship between the China and the US, [what has been really impacting the space] is the short-term mentality of market participants globally,” he said.

Listen to the interview above or read the transcript below for more insight from Klein, including more of his thoughts on the China-US relationship and what he expects from the lithium market next year. You can also click here to listen to our full Benchmark Minerals Week’s interviews playlist on YouTube.

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Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in contributed article. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.