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Livent (LTHM) Stock Sinks As Market Gains: What You Should Know

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In the latest trading session, Livent (LTHM - Free Report) closed at $22.07, marking a -1.25% move from the previous day. This move lagged the S&P 500's daily gain of 0.57%. Elsewhere, the Dow gained 0.7%, while the tech-heavy Nasdaq added 0.08%.

Prior to today's trading, shares of the supplier of performance lithium compounds had lost 12.83% over the past month. This has lagged the Basic Materials sector's loss of 4.62% and the S&P 500's loss of 5.26% in that time.

Livent will be looking to display strength as it nears its next earnings release, which is expected to be May 3, 2022. On that day, Livent is projected to report earnings of $0.14 per share, which would represent year-over-year growth of 600%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $139.43 million, up 52.05% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $0.62 per share and revenue of $582.77 million, which would represent changes of +244.44% and +38.62%, respectively, from the prior year.

Any recent changes to analyst estimates for Livent should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 2.97% higher. Livent is currently sporting a Zacks Rank of #2 (Buy).

Looking at its valuation, Livent is holding a Forward P/E ratio of 35.82. For comparison, its industry has an average Forward P/E of 14.72, which means Livent is trading at a premium to the group.

Investors should also note that LTHM has a PEG ratio of 1.04 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Chemical - Specialty was holding an average PEG ratio of 1.69 at yesterday's closing price.

The Chemical - Specialty industry is part of the Basic Materials sector. This industry currently has a Zacks Industry Rank of 175, which puts it in the bottom 31% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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