The battery materials industry has been under a lot of pressure over the last 12 months.
This has been driven by crashing lithium prices.
For example, the current spot price of lithium carbonate in China is US$13,547 a tonne and the latest spot price of lithium spodumene is US$1,210 a tonne.
As a comparison, lithium carbonate averaged US$63,232 a tonne in 2022 and US$32,694 a tonne in 2023. Whereas spodumene averaged US$4,368 a tonne in 2022 and US$3,712 a tonne in 2023.
Unfortunately for investors in the lithium space, Goldman Sachs believes that prices will remain subdued for the foreseeable future. This is likely to mean margins in the industry will be challenged for some time to come and only the lowest cost producers will be profitable.
In light of this, it will come as no surprise to learn that a number of ASX lithium stocks have been tipped to fall meaningfully from where they trade today.
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Which ASX lithium stocks could tumble?
The first ASX lithium stock that could be destined to tumble is Core Lithium Ltd (ASX: CXO). That's despite its shares being down over 80% since this time last year.
According to a recent note out of Citi, its analysts have a sell rating and 11 cents on its shares. This implies a potential downside of 31% for investors from current levels.
Pilbara Minerals Ltd (ASX: PLS) shares could also be destined to fall heavily from where they trade according to analysts at UBS. Although the broker thinks highly of the business, it still feels its shares are extremely overvalued.
The broker currently has a sell rating and a $2.50 price target on the lithium miner's shares. This suggests a potential downside of over 38% for investors.
Over at Goldman Sachs, its analysts are feeling bearish about Mineral Resources Ltd (ASX: MIN). A note from last week reveals that its analysts have a sell rating and a $48.00 price target on the company's shares. If this proves accurate, the ASX lithium stock will lose 33% of its value over the next 12 months.
Finally, the team at Citi is also tipping Liontown Resources Ltd (ASX: LTR) shares as a sell right now.
Last month, its analysts put a sell rating on the lithium developer's shares with a $1.00 price target. Based on the current Liontown share price of $1.30, this suggests that the Kathleen Valley Lithium Project owner's shares could tumble 23%.
