Analysts say 2 of these ASX lithium shares can double in value

Big gains could be on the cards for shareholders of these lithium shares.

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The lithium industry has taken a beating recently. While this is disappointing, it could prove to be a great buying opportunity for investors.

For example, three ASX lithium shares that analysts have recently named as buys with major upside potential are listed below.

Here's what you need to know about them:

Allkem Ltd (ASX: AKE)

Despite being very bearish on lithium prices, Goldman Sachs remains bullish on Allkem. This is because the broker believes it is well-placed to offset weaker prices with its production growth. In addition, Goldman sees opportunities for the company to benefit from value-added downstream activities.

Goldman Sachs currently has a buy rating and $15.40 price target on its shares. Based on the latest Allkem share price of $10.17, this suggests potential upside of 51%.

Latin Resources Ltd (ASX: LRS)

Latin Resources could be another ASX lithium share to buy. It is focused on lithium exploration and project development across tenements in the state of Minas Gerais, Brazil. This includes the 100%-owned Salinas project, which has an initial mineral resource estimate (MRE) of 13.3Mt @ 1.2% Li2O.

However, Bell Potter doesn't expect the MRE to stop there. Last week, it highlighted that drilling at Colina West will potentially add significant scale to the Salinas MRE.

In light of this, the broker has reiterated its speculative buy rating with a 22 cents price target. This is more than double the current Latin Resources share price of 10 cents.

Pilbara Minerals Ltd (ASX: PLS)

Finally, Pilbara Minerals' shares could also have material upside potential according to analysts. It is the owner of the Pilgangoora Project. This is one of the largest hard rock lithium deposits in the world and considered strategically important within the global lithium supply chain.

Macquarie appears to believe recent weakness in the Pilbara Minerals share price has created an incredible buying opportunity. Last week, it retained its outperform rating with a $7.50 price target. Based on the current Pilbara Minerals share price of $3.56, this implies potential upside of 110%. Macquarie is also forecasting a massive dividend yield of 11.5% in FY 2023.

Motley Fool contributor James Mickleboro has positions in Allkem. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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