It’s been a tough day on the ASX for the lithium developer. Here’s what happened.
The post Why did the Liontown share price slump 9% today? appeared first on The Motley Fool Australia. –
TheÂ Liontown Resources LimitedÂ (ASX: LTR) share price closed deep in the red on Thursday.
At the final bell, the lithium developerâs shares were down 9.28% to 88 cents apiece. That’s a big drop from when its shares were trading as high as $1.37 at the beginning of the month.
Letâs take a look at what might have impacted Liontown shares today.
Liontown loses ground amid broker price cut
While the company hasnât made any announcements since earlier this month, one broker weighed in on the Liontown share price.
As reported by ANZ Share Investing, Macquarie slashed its price target on the companyâs shares by 24% to $1.90.
The significant cut follows theÂ bearish analysisÂ of the battery metals market by peer investment firm, Goldman Sachs.
Nonetheless, based on the current share price, the re-adjusted broker rating implies an upside of roughly 115%.
In addition, theÂ S&P/ASX 300 Metals and MiningÂ (ASX: XMM) industry also finished in negative territory today, by 1.94%.
Currently, lithium carbonate per tonne is trading at US$71,400 per tonne. This reflects an increase of just 4.37% for the month compared to 430% year-on-year.
Liontown share price snapshot
Since reaching an all-time high of $2.19 in April, the Liontown share price has fallen almost 60%. Weakened sentiment across the industry is likely playing a significant hand in the drop.
When looking at year-to-date, Liontown shares are down almost 47%.
Based on todayâs price, Liontown commands a market capitalisation of approximately $2.25 billion.
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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs. The Motley Fool Australia has recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.