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February 10th, 2022 | 12:34 CET

Standard Lithium, Yorkton Ventures, Deutsche Bank - The new favorites

  • Lithium
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For many years, shares of banks and financial service providers underperformed the overall market. With the end of the ultra-loose monetary policy of the central banks and several possible interest rate hikes due to continued high inflation, stocks are benefiting disproportionately and sometimes break through their downward trends that have prevailed for years. In addition to high energy costs, the blame for the enormous price increases lies with the further rise in raw material prices. Because of the demand side due to the energy transition, lithium, in particular, is rushing from high to high.

time to read: 4 minutes | Author: Stefan Feulner
ISIN: STANDARD LITHIUM LTD | CA8536061010 , Yorkton Ventures Inc. | CA9872111096 , DEUTSCHE BANK AG NA O.N. | DE0005140008

Table of contents:

    Limited, existential raw material

    Battery cells are a key technology for the energy transition, especially for electromobility. Today, lithium-ion technology requires one of the most important raw materials: lithium. Although scientists are already working on new cell concepts, such as sodium-ion technology, the current demand is still unbroken and will continue to increase, at least in the near future. The Fraunhofer Institute for Systems and Innovation Research ISI predicts that demand for lithium-ion cells for electromobility alone will explode by a factor of 20 to 40 by 2030.

    Therefore, it is not without reason that lithium futures are rising to new highs almost daily; the contract for March 2022 has nearly tripled in the past six months. Standard Lithium now had an opportunity, albeit a speculative one, to jump on the bandwagon due to short attacks. The Vancouver-based company with a market capitalization of EUR 833.50 million has been one of the stock market stars since the hype began. Now the Company, which maintains its main project on some 150,000 acres in the southern US state of Arkansas, has fallen victim to Hindenburg Research, which claimed in a report that Standard Lithium in its publications unlawfully failed to disclose information about the pilot project in Arkansas. In addition, the letter of intent announced in January with major shareholder Koch Minerals & Trading LLC for the purchase of lithium chemicals and the procurement of critical raw materials, was criticized.

    A detailed rebuttal from the Company allowed the share price, which fell below the important support at EUR 5.00 after Hindenburg's insinuation, to stabilize again. A new buy signal will be generated if the share price breaks through the resistance at around EUR 7.00.

    Yorkton Ventures with buy-and-build strategy

    In contrast to Standard Lithium, Yorkton Ventures, listed in Frankfurt and Toronto since the beginning of the year, is somewhat calmer. With a market capitalization of the equivalent of EUR 7.47 million, the Company, which is also based in Vancouver, Canada, is still in the process of building up its portfolio, which consists of gold and lithium deposits. Led by CEO Andres Lee Smith, with more than 25 years of experience as a geologist, two gold projects are located in Newfoundland and one in Quebec. Historically, the Bellechasse-Timmins Gold property in Quebec contains approximately 171,000 ounces of gold as a mineral resource at an average grade of 1.83 g/t gold and an inferred resource of 95,000 ounces of gold at 1.36 g/t.

    However, Yorkton Ventures' primary focus is building a lithium portfolio to participate in the rapidly growing boom. Late last year, a group of three non-contiguous lithium properties, Key Lithium, Amisk West Lithium and Amisk East Lithium, collectively known as the Cyr-Kapiwak project, were secured in the James Bay area of Quebec. The acquisition agreement, which the regulatory authority has approved, has now been completed.

    The lithium project consists of 42 mineral claims covering a total area of 22.20 sq km. The area is located near Allkem's James Bay lithium concession area and about 3 km from the proposed James Bay mine. The Amisk West and Amisk East lithium claims are located several kilometers south of the Key lithium claim and are both adjacent to Medaro Mining Corp's Cyr South lithium claim. The Amisk claims cover large areas of pegmatite-bearing granites that remain largely unexplored.

    Andrew Lee Smith, CEO of the Company, commented, "We are pleased to have acquired this key claim block in the James Bay area. It provides us with the opportunity to explore two highly prospective zones in the vicinity of Allkem's James Bay project. Preparations for the 2022 field season are underway, and Yorkton Ventures expects to actively advance its Quebec projects during the summer field season."

    Winners of the interest rate turnaround

    Since the outbreak of the financial crisis in 2008, when prices of EUR 90.00 were still the norm, Deutsche Bank's share price has steadily lost value, and the stock has been in a year-long downtrend, culminating in an all-time low at EUR 4.45 on the occasion of the Corona shock in March 2020. Since then, the Company has recovered, having undergone tough cost-cutting and restructuring measures in recent years. The breakout from the downward trend at EUR 12.60, which has been in place since 2008, has paved the way for a turnaround. The next interim target is already at the 2018 high of EUR 17.42.

    The relative strength is reflected in the fact that the major shareholder Cerberus is using the recent price increase to further reduce its share package. Already in January, the US investor placed around 21 million shares. According to information from the news agency Bloomberg on Tuesday evening, a further 15 million shares in Deutsche Bank are to be sold. The stake is expected to fall from just under 2% to slightly more than 1%. The pieces are to be offered at EUR 14.15, with the proceeds amounting to more than EUR 200 million.

    Due to the change in monetary policy, shares of banks and financial service providers are in demand. Deutsche Bank was able to leave its long-term downward trend. Long-term demand is also likely to be present in the commodity lithium. Standard Lithium was the victim of a short attack, and Yorkton Ventures is in the process of building a first-class portfolio.

    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") currently hold or hold shares or other financial instruments of the aforementioned companies and speculate on their price developments. In this respect, they intend to sell or acquire shares or other financial instruments of the companies (hereinafter each referred to as a "Transaction"). Transactions may thereby influence the respective price of the shares or other financial instruments of the Company.
    In this respect, there is a concrete conflict of interest in the reporting on the companies.

    In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.
    For this reason, there is also a concrete conflict of interest.
    The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.

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    Der Autor

    Stefan Feulner

    The native Franconian has more than 20 years of stock exchange experience and a broadly diversified network.
    He is passionate about analyzing a wide variety of business models and investigating new trends.

    About the author

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