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August 31, 2017 | This Metal Will Shift Your Profits into Higher Gear

Sean Brodrick

Sean is the natural resource analyst for Weiss Group. You can read his thoughts on gold, oil, cannabis, uranium and other natural resources at EdelsonInstitute.com

The future is roaring straight toward us, and it’s shifting into higher gear.

I’m talking about electric vehicles (EVs). Now, if you think about electric vehicles, you probably think “Tesla.” But it’s time to expand your horizons AND your profits. Tesla (TSLA) is the EV maker of the past.

Yeah, yeah, Tesla’s Gigafactory 1 in Nevada is the bee’s knees. And founder Elon Musk plans to build another 10 to 20 plants where it can make batteries for its EVs.

But you know what? There are 17 other gigafactories already built, being built, or planned around the world.

Volkswagen is building its own mega-battery plant in Germany. And it has stated a goal to “more than triple the range” of VW’s current crop of electric vehicles.

Do you think Tesla can compete with Volkswagen?

Tesla produced 83,922 vehicles last year. And lost money on each one. Volkswagen produced 10.3 million cars last year. That means it equals Tesla’s entire annual production in just three days.

Sure, Tesla is going to crank up production. I guess now it will lose more money, faster.

And it’s not just Volkswagen (VLKAY). It’s Ford (F)General Motors (GM) and Toyota (TM). And, a bunch of Chinese carmakers you never heard of.

All the big carmakers are making detours off the internal-combustion engine (ICE) vehicle highway. And they’re ramping-up their electric-car production as rapidly as possible.

And what do all these cars have in common? Lithium-ion batteries.

Now, I can make a case for all the metals used in lithium-ion batteries. I often do. Subscribers to my Supercycle Investor publication will tell you I have lots to say on the subject.

But today, we’re going to talk about just one of those metals: Lithium.

Energy Storage Growth

In 2016, half of global lithium supplied went to energy storage. That includes batteries for EVs, electronics and grid storage. That’s up from about 30% in 2014.

That’s some growth!

Lithium demand for energy applications is projected to soar over the next five years.

Batteries account for 50% of the lithium market. But this trend is just starting.

The fact is: Lithium-ion batteries are superior to regular rechargeable batteries. That’s because they can be recharged … over and over and over again.

That’s why everyone wants lithium. And why, as an investor, you should, too.

History is on Our Side

Shortly after the turn of the last century, we saw the world shift from horses to internal-combustion engine vehicles. Now, a similar shift is going on, this time to EVs.

Still, electric cars represented only 1.1% of total auto sales in 2016.

According to a report by Reuters, Consultants CRU Group said that electric cars and plug-in hybrid vehicle sales could hit 4.4 million in 2021. That is a heck of a jump from last year.

The long-term outlook is good, too! Morgan Stanley forecasts that the production and use of electric cars will rise to 9.4% of the 102 million anticipated new vehicles in 2025. Then keep rising.

It should hit 81% of 132 million new auto sales by 2050, from just 1.1% of 86.5 million new autos this year.

And that is sending lithium’s price higher … and HIGHER!

Consultants at Roskill estimate we will need 785,000 metric tons per year of lithium-carbonate equivalent by 2025.

That works out to a 26,000-metric-ton shortfall from the anticipated supply. Compare that to 217,000 tons of demand vs. 227,000 tons of supply this year. And other analysts expect an even larger deficit.

Do you have a spare 10,000 tons of lithium hanging around?

Don’t feel bad. No one else does, either!

The Race Is On!

Hence, the race for new lithium supplies is on. And lithium prices are shifting into high gear.

Do you want your profits to shift into high gear? Then you better get busy buying the best lithium miners. This EV megatrend and lithium supercycle aren’t going away.

My Supercycle Investor subscribers already own the best lithium stocks. We’ll buy more. Do your own due diligence if you go that route.

But here’s the good news: You can ride this lithium road to riches with an ETF. I’m talking the Global X Lithium & Battery Tech ETF (NYSE: LIT). Take a look at this weekly chart.

Nice trend, eh? It’s very liquid. More so all the time, as the lithium revolution steps on the gas.

LIT owns a basket of lithium miners and battery-makers. It’s plugged into the next big names in the industry. And it will help you rev your profit engine.

If you’re more conservative, wait for LIT to pull back to its 10-period moving average on its weekly chart. That’s the 50-day moving average. It does that regularly.

If you’re more speculative, well … what are you waiting for?

To get my timely signals and specific stocks to buy and when, go here.

Full disclosure: I trade in and out of lithium stocks in my personal account. And I may buy (and sell) LIT in the future.

All the best,
Sean Brodrick

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August 31st, 2017

Posted In: The Edelson Institute

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