Liontown Resources Ltd (ASX: LTR) shares were on form on Wednesday.
The lithium developer's shares were up as much as 18% at one stage before ending the day with a 6% gain to $1.40.
Investors were buying the company's shares after it entered into a $550 million debt facility agreement.
These funds will be used to ensure the Kathleen Valley Lithium Project is funded through to its first production and the ramp-up to the company's three million tonnes per year base case.
Image source: Getty Images
Can Liontown shares keep rising?
One leading broker that believes the worst is over for the company is Wilsons.
In response to its debt funding news, the broker upgraded Liontown's shares to an overweight rating. It also lifted its price target massively to $1.85 from 85 cents.
Based on where its shares ended yesterday's session, this implies potential upside of 32% for investors.
The broker believes that this agreement means that the company is now fully funded through to positive cash flow in early 2025.
It also highlights that "now that funding has been finalized, another major de-risking hurdle has been cleared on that way to commissioning."
Sitting on the fence
One broker that doesn't think investors should jump in just yet is Goldman Sachs.
This morning, the broker responded to the news by retaining its neutral rating and $1.45 price target on its shares. This is largely in line with where they trade today.
Though, it agrees with the view that Liontown will be generating positive free cash flow next year. Goldman said:
We forecast Kathleen Valley turning FCF positive from mid-CY25 on our spodumene price forecast, which we expect to support any refinancing of the debt if not already agreed prior, where LTR is continuing to explore options for a longer-term funding solution in parallel to provide future flexibility and optionality beyond the 3Mtpa base case.
