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Written by Gabriel Osorio-Mazilli on September 25, 2025 |
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Key Points |
The United States government is set to take a new stake in Lithium Americas stock, the latest in a series of market acquisitions. This sentiment in rare earth metals could spill over into other closely related companies. With this view in mind, Wall Street analysts and institutions are getting ahead of the curve.
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Shares of Lithium Americas Inc. (NYSE: LAC) jumped by just over 90% in a single day, a reaction that came after President Trump announced that the United States government would be taking a stake in the company. The rare earth metals supply worldwide is becoming a major focus point in the current agenda, and as trade negotiations with China intensify, it is logical that this consolidation is deemed important today. |
That being said, this isn't the only acquisition happening in the market right now. The government has also bought a multi-million-dollar stake in Intel Corporation (NASDAQ: INTC) as part of another consolidation effort in the technology sector. |
While that is unrelated to the rare earth metals narrative, it demonstrates to retail investors just how nimble investment capital has become today. |
That nimbleness and interest on the part of the government have raised the probability that other companies (lateral to Lithium Americas) could also fall into the potential acquisition pipeline, creating unexpected yet very realistic upside scenarios. |
This is why investors should look at names like Albemarle Corp. (NYSE: ALB) and Uranium Energy Corp. (NYSEAMERICAN: UEC) for a watchlist focused on rare earth metals. |
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What's the Interest Behind Lithium Americas Stock? |
One of the most exciting industries in the market right now is the advancement of electric vehicles (EVs) and the next wave of leading semiconductors, both of which ask for their fair share of demand when it comes to lithium. |
Lithium could become a highly sought-after commodity as the artificial intelligence and clean energy race between the United States and China continues. |
Even without further acquisitions, it's smart to have some exposure to this long-term theme, as these two industries are unlikely to be shaken out and will likely continue to grow from here. More than just the fundamental theme, this new momentum, which has sent Lithium Americas stock to a new 52-week high, has triggered a few additional benefits. |
This $1.4 billion company is small enough to tilt the risk-to-reward scale in favor of the buyers, as there's limited downside potential. A terrible bear case would be required to bring this market capitalization lower, which is unlikely. However, not everyone in the market is aware of this fact. |
That is why there is still $82.6 million worth of open short positions for Lithium Americas stock, or 11.5% of the total outstanding shares. Another rally like this one, and there is a very real chance that a short squeeze might be the end result, creating more buying pressure and sending the stock even higher. |
Albemarle is The Proven Concept |
While Lithium Americas is a smaller company and has yet to prove its place in the industry, Albemarle is a seasoned operator in lithium mining. This makes it a highly desirable target for consideration as the next move in the space, especially considering the company's recent financial performance. |
Albemarle's latest quarterly earnings results delivered a big surprise to the markets. A net 11 cents in earnings per share (EPS) came significantly above the MarketBeat consensus estimate for a net loss of 83 cents instead. As bullish as this may seem, it's not even close to what investors are set up for in the next quarter. |
This consensus also points to a forecast of $2.74 in EPS for the third quarter of 2025, a significant jump from current levels if Albemarle can deliver. Even if the actual results fall short of these expectations, the stock has traded down to only 72% of its 52-week high, creating a sufficient margin of safety for shareholders. |
Whether due to the company's merits or the potential for it to become the next acquisition target, Albemarle is a name with a great risk-to-reward ratio at these prices. |
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Wall Street Lands on Uranium Energy Stock |
While lithium is one of the hot names today, uranium is a rare earth metal that is only getting started in its long-term bull cycle. The United States recognizes the fundamental fact that onshoring data centers and artificial intelligence infrastructure will require significantly more electricity capacity, as today's setup falls short of the forecasts. |
The long-term solution to this issue is to pivot towards more sustainable and efficient energy sources, and nuclear energy may play a role. Of course, there is no transition to this environment without a company like Uranium Energy to provide the raw materials and make it possible. |
That's why Caxton Associates built up a $27.8 million stake in the stock in August 2025, a decision that came closely on the heels of Katie Lachapelle's (from Canaccord Genuity Group) new $17.50 per share price target on the stock. Compared to the consensus of $11.63, this view stands significantly above, calling for 28% of additional upside potential. |
Even if the government doesn't bid for these two stocks, they have enough fundamental tailwinds to ride off the optimism now created in Lithium Americas and deliver a justified bull run for their shareholders. |
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