Shares in Atlas Lithium (NASDAQ:ATLX) stock jumped 60% on Feb. 23 as interest in lithium, a key ingredient in electric car batteries, continues to rise.
Atlas recently closed a public offering on . It was also , from a secondary exchange to the main Nasdaq board.
Atlas executives rang the opening bell to begin Nasdaq trading on . The shares opened at about $19 each, a market capitalization of just $112 million. Yet, As of writing, ATLX stock has since cratered down about 20% during the morning trading session.
Important to note that Atlas has not yet begun any actual mining operations.
Light Metal Power
Atlas has mining rights on over 56,000 acres in the state of , between Rio de Janeiro and the capital of Brasilia.
The company has been rising as speculation grows that Tesla (NASDAQ:TSLA) may buy it. Sigma Lithium (NASDAQ:
SGML), which , has drawn similar interest. Both companies could export rock lithium from the Brazilian coast for fast delivery to American processing plants.
Lithium prices have been , especially inside China. But lithium is abundant in South America, with under development in Brazil alone. Salt flats at the intersection of Argentina, Chile, and Bolivia are said to contain .
The rapid expansion of the production of electric cars in the U.S. is also . By 2030 the Biden administration hopes half of U.S. vehicles will have zero emissions. Most will run on lithium batteries.
There remain risks, however. There is much more lithium in the than in Brazil. Lithium is a global market, and China is the largest producer. Atlas has not yet opened its mines. Brazilian stability cannot be guaranteed.
ATLX Stock: What Happens Next?
Speculation in Atlas is all about the potential buyout and the magic word “lithium.” There is a lot less to this company than meets the eye. Tread carefully.
On the date of publication, Dana Blankenhorn held no positions in any companies mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
