Tiny lithium stock uncovers 'outstanding' find next-door to ASX 200 fave

The company's CEO said Allkem's planned merger is "a clear endorsement" of its plan to develop its flagship asset.

| More on:
A miner in a hardhat makes a sale on his tablet in the field.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • Shares in $58 million lithium hopeful Lithium Energy spent this morning soaring before plummeting into the red this afternoon
  • The stock roared 11% to peak at $1.065 earlier but has since slipped to trade 3% lower at 93.5 cents
  • Its moves came amid "outstanding" assay results from its flagship Solaroz Brine Project, located next door to Allkem's flagship facility

Stock in tiny lithium hopeful Lithium Energy Ltd (ASX: LEL) took off earlier today before plunging into the red on news of a massive find at the company's Solaroz Brine Project.

The project is located in Argentina, right next door to Allkem Ltd (ASX: AKE)'s flagship lithium facility, Olaroz.

Lithium Energy chair William Johnson dubbed the S&P/ASX 200 Index (ASX: XJO) giant's recently-announced mega-merger plan:

A clear endorsement of our strategy to rapidly accelerate the development of Solaroz.

The Lithium Energy share price leapt to trade at $1.065 earlier today, marking an 11% jump on its previous closing price. It has since handed back all of that gain, and then some.

Right now, the stock is down 2.6%, trading at 93.5 cents.

Let's take a closer look at what's going right for the $58 million lithium hopeful on Monday.

Tiny ASX lithium stock pops then drops on "outstanding" find

A drilling program at Solaroz has been front of mind for fans of Lithium Energy shares lately. The company announced drilling had extended massive intersections of conductive brines at the project on Friday. Today, assays have confirmed the find.

The fourth and fifth drill holes completed at the project have identified conductive brines at depth with excellent lithium grades across massive intersections.

The fourth hole was found to host a total 473.5 metre intersection of lithium-rich brines, with concentrations of up to 508 milligrams of lithium per litre to date.

Meanwhile, the fifth hole saw its intersections of conductive brine extended to 489 metres, with an increase in lithium brine concentration of up to 495 milligrams per litre.

Johnson said drilling at the project "continues to deliver outstanding intersections of lithium rich brines", continuing:

These drilling results continue to demonstrate the potential for Solaroz to support a world class resource of lithium and with three rigs soon to be operating concurrently, we are excited to be rapidly advancing towards defining our maiden JORC resource at Solaroz.

Lithium Energy share price snapshot

This year has been good to the ASX lithium stock so far.

The Lithium Energy share price has gained 26% since the start of 2023. Though, it's 19% lower than it was this time last year.

For comparison, the benchmark All Ordinaries Index (ASX: XAO) has gained 4% year to date and 1% over the last 12 months.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for over ten years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the 'five best ASX stocks' for investors to buy right now. We believe these stocks are trading at attractive prices and Scott thinks they could be great buys right now...

See The 5 Stocks *Returns as of 30 April 2025

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. 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.

More on Materials Shares

A man wearing a shirt, tie and hard hat sits in an office and marks dates in his diary.
Materials Shares

Rio Tinto share price tumbles on CEO bombshell news

The mining giant is now looking for a new leader.

Read more »

a mine worker holds his phone in one hand and a tablet in the other as he stands in front of heavy machinery at a mine site.
Materials Shares

What's going on with the Fortescue share price today?

This mining giant is making changes to its leadership.

Read more »

Happy construction worker at a building site with a group of workers at the background.
Materials Shares

After its result, does Macquarie rate James Hardie shares a buy, hold or sell?

The company announced its FY25 earnings on Wednesday.

Read more »

Miner and company person analysing results of a mining company.
Materials Shares

Fortescue shares fall on Iron Bridge blow

Iron Bridge is taking longer to ramp up than planned.

Read more »

Three miners looking at a tablet.
Materials Shares

Buy Rio Tinto shares for a 23% return

Let's see which broker is tipping this mining giant as a top buy.

Read more »

A bricklayer peers over the top of a brick wall he is laying with a level measuring tool on top and looks critically at the work he is carrying out.
Materials Shares

Brickworks shares have surged 15% in a month. Are they still good value according to Macquarie?

Here's what this broker has to say about the stock.

Read more »

A man checks his phone next to an electric vehicle charging station with his electric vehicle parked in the charging bay.
Materials Shares

Are Pilbara Minerals shares too cheap to ignore?

A leading broker has given its verdict on this beaten down lithium miner.

Read more »

An unhappy man in a suit sits at his desk with his arms crossed staring at his laptop screen as the PointsBet share price falls
Materials Shares

Does Macquarie rate James Hardie shares a buy, hold or sell?

The company is set to report FY25 earnings this week.

Read more »