Up 2x Over The Last Month, What’s Driving American Battery Tech Stock?

American Battery Technology (NASDAQ:ABAT) has seen its stock more than double over the past month, jumping from around $1.35 to over $3 per share. What’s driving the surge, and is there more to come?

Image by Lee Rosario from Pixabay

Lithium Mining Push

The recent surge appears tied to growing momentum around ABAT’s Tonopah Flats Lithium Project (TFLP) in Nevada, which was granted “FAST-41” transparency priority status by the U.S. Federal Permitting Council. This designation helps accelerate federal approvals across multiple agencies, and is a likely indicator of the project’s strategic importance. The project is ambitious, aiming to develop a domestic lithium mine and a refinery capable of producing 30,000 metric tons of lithium hydroxide annually – a key material for electric vehicle (EV) batteries and energy storage systems. ABAT has also secured notable financial backing, including a $58 million grant from the U.S. Department of Energy and a $900 million letter of interest from the Export-Import Bank of the United States to support project construction and expansion of the project.

Battery Recycling Gains Importance

As the U.S. pushes to reduce its reliance on Chinese critical mineral imports, ABAT’s domestic focus – both in mining and in its closed-loop battery recycling facility –  plays directly into these policy tailwinds. The company’s Nevada-based commercial-scale recycling operation enables it to recover battery-grade lithium and other key metals from used batteries, driving a more sustainable domestic supply chain. The company, focused on the extraction, refining, and recycling of critical battery materials like lithium and cobalt – essential inputs for electric vehicles (EVs) and clean energy storage systems, by disassembling battery packs step-by-step rather than shredding or smelting. This system can handle various types of lithium-ion battery chemistries and forms. Although the business is small currently, battery recycling could be a big business in the long-run, as the EV industry matures and EV upgrade cycles take hold.

More Gains For the Stock?

That said, the stock remains highly speculative. Despite the upside potential from rising lithium demand and EV adoption, ABAT is still in the early stages of commercialization. The company generated just $1.9 million in revenue over the past 12 months, with an operating loss of $46 million. Its price-to-sales ratio stands at a steep 144.5 far above the S&P 500 average of 3.1, and it trades with a market cap below $300 million. While government support and strategic relevance to the clean energy transition provide strong catalysts, ABAT remains a small-cap, early-stage company susceptible to operational, financial, and execution risks typical of such ventures.

While you would do well to be cautious about ABAT stock for now, you could explore the Trefis Reinforced Value (RV) Portfolio, which has outperformed its all-cap stocks benchmark (combination of the S&P 500, S&P mid-cap, and Russell 2000 benchmark indices) to produce strong returns for investors. Why is that? The quarterly rebalanced mix of large-, mid- and small-cap RV Portfolio stocks provided a responsive way to make the most of upbeat market conditions while limiting losses when markets head south, as detailed in RV Portfolio performance metrics.

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