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As commodity prices rise, SQM will be able to take advantage. They have performed well over the past few months but we believe there is room for further growth. The company just announced that they will be investing in a fleet of electric trucks to lower logistics costs, which can additionally lower operating costs. Chile is also a stable and historically fast growing emerging market giving it the ability to support a company like SQM well.
Closing position because its current price is really close to its peak 6M, 1Y and 5Y price level. It has been very volatile and driving a lot of the volatility in our portfolio in the last few weeks so we want to get rid of it, realize the $137,000 in gains and buy something safer in the next few weeks
The fertilizers space is seeing solid earnings estimate revision activity. Lithium prices hit three-year highs on September 13 (think EV and battery related growth), which SQM is a market-leading producer. Its made calls for innovation projects focused on electromobility and energy storage in the past month geared towards increased correspondance with Chilean universities and R&D centers.
Reading about Lithium prices climbing fueled by EV/battery demand and taking into account global supply shortages, SQM seems like a solid growth ETF to diversify my portfolio with. I had a hard time finding data on this ETF outside of user comments but I am curious to see how it does.
This is a lithium supply company located in Chile, a hotbed of lithium supply. On a short-term basis, the company is expected to announce impressive growth in EPS numbers in the coming days, despite falling top-line revenue. Quarterly EPS is expected to rise to $0.45 from $0.28 YoY, representing a significant jump. Longer-term, this company is poised to capitalize on the emergence of the EV market, one of the largest growing demand uses for lithium within the time frame of this trading game. Being located in a prime location of lithium production makes SQM a strong emerging leader in this space.
SQM is the largest lithium company operating in Chile. This company is well positioned to capitalize on increased lithium demand as a result of the proliferation of lithium ion batteries in transportation applications, similar to our thesis with our ALB position. However, SQM primarily sells lithium on spot markets, making this a play based primarily on the thesis that lithium demand will continue to drive price increases in the Lithium market. - TK