The Liontown Resources Limited (ASX: LTR) share price is having a mixed year.
While the lithium developer's shares are beating the struggling ASX 200 index with a 1.4% year to date gain, this pales in comparison to some of the gains being recorded in the lithium industry.
But could its shares start roaring in the coming months?
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Where next for the Liontown share price?
According to one leading broker, the Liontown share price is potentially heading a lot higher from here.
A note out of Bell Potter reveals that its analysts have a speculative buy rating and $2.87 price target on the company's shares.
Based on the current Liontown share price of $1.78, this implies potential upside of 61% for investors over the next 12 months.
Why is the broker positive?
Bell Potter highlights that while Liontown is not producing lithium at present, its Kathleen Valley lithium project is under development. It expects the Liontown share price to start to gain investor attention as the project development de-risks and production gets closer. Particularly given its offtake agreements with major players Ford, Tesla, and LG Energy Solution.
The broker explained:
LTR's Kathleen Valley lithium project in Western Australia is currently in development and has the backing of major downstream EV participants. The project's scale and mine life lend optionality to future product value-adding though downstream lithium refining.
ESG is at the forefront of LTR's development strategy, particularly across employing renewable energy and ensuring strong engagement with traditional owners. We expect LTR's value to respond to Kathleen Valley's de-risking through project development and with further consideration of potential downstream developments.
All in all, Bell Potter appears to believe this could be one for patient investors. Though, it does warn that "LTR is an asset development company with prospective operations and cash flows. Our Speculative risk rating recognises this higher level of risk and volatility of returns."
