IGO Ltd (ASX: IGO) shares have been battered over the past year amid stagnant lithium prices and a barrage of bad press.
IGO shares have dropped about 28% so far this year, as the company's CFO announced she's leaving.
In fact, IGO has seen its value sink by more than 50% over the past year.
IGO, with a market cap of about $2.6 billion, mines nickel, copper, and cobalt in Western Australia.
It's also a joint venture partner with Tianqi Lithium Corporation in the Greenbushes lithium mine in WA.
The JV, known as Tianqi Lithium Energy Australia Pty Ltd, also owns the Kwinana Lithium Hydroxide Refinery, located outside Perth.
Image source: Getty Images
Downgrades
Earlier this year, IGO announced that it had downgraded its Greenbushes production estimates from 1.4 to 1.5 million tonnes to 1.3 to 1.4 million tonnes.
The company attributed its revised estimates to weakness in the lithium market and reduced its Greenbushes sales forecast by 20%.
More bad news emerged from Greenbushes at the start of this month when local residents voiced concerns about the mine's environmental impact on the community.
Residents living near the mine, one of the world's largest hard rock lithium mines, voiced health concerns resulting from dust emissions.
A week later, IGO announced that CFO Kathleen Bozanic had handed in her resignation and that she would leave the company later this year.
If we look further back through the archives, we can see that IGO's bad press is not limited to this year.
And the company's latest half-year results left investors with little to celebrate.
IGO posted a loss after tax of $782 million as revenues sank 35% to $284 million.
Some good news
Despite challenges, the company finished the first half with $247 million in cash and an undrawn $720 million debt facility.
And while lithium prices are expected to remain subdued for the near term, forecasts still point to rising lithium prices over the longer term.
Amid rising demand for EVS and clean energy solutions, lithium miners and producers that can survive the prolonged downturn in prices will likely benefit as competition and supply thin.
As such, some analysts are backing IGO shares.
Goldman Sachs has retained its buy rating and a $4.60 price target on IGO shares.
Based on its current share price of $3.40, this implies a potential upside of about 35% over the next 12 months.
Still, it's too early for me to buy IGO shares.
