Lithium Americas (LAC) Touches New High, Then Loses Momentum After 'Sell' Reco

We recently published 10 Stocks Investors Are Dumping. Lithium Americas Corp. (NYSE:LAC) is one of the worst performers on Monday.

Lithium Americas fell by 6.53 percent on Monday after touching a new 52-week high, as investors took path from an investment firm’s “sell” recommendation for its stock.

In intra-day trading, Lithium Americas Corp. (NYSE:LAC) soared to its highest price of $9.48 before giving up gains to end the day at $8.45 apiece.

This followed Scotiabank’s market note, giving the company a “sell” recommendation, saying that the stock can no longer support the valuation after skyrocketing by 200 percent over the past two weeks alone.

“We failed to appreciate how a heated bull market would interpret [President Donald] Trump’s magic touch, on a thematic commodity starving for attention… despite the magic touch being dilutive to shareholders,” Scotiabank said.

“Perhaps, investors believe the DoE (Department of Energy) will backstop delays/cost overruns – i.e., LAC is now too important to fail.”

“We encourage investors to take profits on a remarkable run, and reload at lower levels.”

Last week, the US government announced that it was taking a 10 percent stake in the company and its Thacker Pass mine site in Nevada, as it aims to support the domestic production of lithium and reduce the country’s reliance on imports.

While we acknowledge the potential of LAC as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.

READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now.

Disclosure: None. This article is originally published at Insider Monkey.