Goldman downgrades SQM, says shares ahead of fundamentals

Goldman Sachs downgraded SQM (SQM) to Neutral from Buy with a price target of $63, up from $45. The shares, after rallying 80% year-to-date, have run ahead of the company’s fundamentals, the analyst tells investors in a research note. The firm believes SQM shares are now pricing in an $18,000 per ton lithium carbonate price, which is 80% above Goldman’s two-year average and 30% above its long term price expectations. In addition, the company’s spending should remain elevated as it invests in lithium growth in Chile and Australia, adds the analyst. Goldman sees a balanced risk/reward at current share levels.