What happened
Prior to the market opening this morning, shares of Livent Corporation (LTHM) had fallen 4% for the week. Today, however, the lithium stock is headed in the opposite direction as investors celebrate the company's fourth-quarter 2021 earnings report, which was released yesterday after the market closed.
As of 11:04 a.m. ET, shares of Livent were up 3.1%, having retreated from their 14.9% rise earlier in the trading session.
So what
Surpassing expectations, Livent reported Q4 2021 revenue of $122.9 million whereas analysts estimated the company would book $106.5 million on the top line. Further down the income statement, Livent provided another surprise, reporting adjusted earning per share of $0.08 -- slightly higher than the Street's expectation of $0.07.
But it's management's look at what lies ahead for the company, instead of its previous performance, that may be powering the bulls' enthusiasm today.
Image source: Getty Images.
Livent forecasts 2022 revenue of $540 million to $600 million. Should the company achieve the midpoint of this guidance, it will represent a 36% increase over the $420.4 million the company reported in 2021. Similarly, the company projects earnings will also rise in the coming year. While Livent reported adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $70 million in 2021, management projects adjusted EBITDA will rise between 130% and $188% to between $160 million and $200 million.
Now what
With Livent reporting a strong end to 2021 and significant growth in 2022, investors who are looking to power their portfolios with a lithium stock may find Livent compelling at the moment. Savvy investors know that an auspicious forecast is a good sign, but it's hardly the only thing to consider. Therefore, prospective investors will want to closely monitor the company's progress in developing its capacity expansion projects in Argentina ad North Carolina.
