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Livent (NYSE:) Corp., a leading lithium-ore miner, experienced a 4% drop in its share value in the extended session on Tuesday. This decline followed the company’s Q3 results, which fell short of Wall Street estimates by FactSet, and a reduction in year-end guidance.
Despite reporting an increase in earnings from $77.6 million (37 cents per share) to $87.4 million (42 cents per share), and adjusted earnings of 44 cents per share after considering one-time items, Livent faced a 9% revenue drop to $211.4 million. This decrease was attributed to lower average prices, even though sales volumes remained steady and overall costs were reduced.
In addition to the disappointing Q3 results, Livent also lowered its 2023 revenue outlook. The previous estimate ranged between $1.025 billion and $1.125 billion, but the revised forecast now stands between $890 million and $940 million.
CEO Paul Graves stated that the company is actively working with customers to meet the growing demand for lithium. He also outlined plans for substantial production volume increases through capacity expansions starting from 2024. Despite current challenges, these initiatives suggest Livent’s commitment to leveraging the expanding lithium market for future growth.
InvestingPro Insights
In light of the recent financial events surrounding Livent Corp ., InvestingPro provides some valuable insights. According to InvestingPro’s real-time data, Livent’s market cap stands at $2620M USD, with a P/E ratio of 7.12, indicating a potentially undervalued stock. The P/E ratio adjusted for the last twelve months as of Q2 2023 is slightly higher at 7.38. Additionally, the company’s revenue for the same period was 940.3M USD, showcasing a significant growth of 59.72%.
InvestingPro Tips highlight that Livent has been consistently increasing its earnings per share, and its valuation implies a strong free cash flow yield. Nevertheless, the stock has experienced significant volatility and is currently trading near its 52-week low. It’s worth noting that the company operates with a moderate level of debt, and its liquid assets exceed short-term obligations.
These InvestingPro Tips, and many more, are available to subscribers of InvestingPro, which offers a comprehensive analysis of a wide range of companies. For those interested in Livent Corp., there are 11 additional InvestingPro Tips available, providing a more in-depth understanding of the company’s financial status.
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