BMO Capital analyst Robin Fiedler lowered NextSource Materials Inc (TSX:NEXT) (OTC:NSRCF) price target to C$6 from C$7 while maintaining the Outperform rating on the shares.
The analyst states that despite progressing well with Phase-1 of the graphite mine, NEXT's share performance has waned recently, absent any further clarity on the anode plant strategy.
Fiedler thinks that's from prudence and strategic optimization versus any thesis-changing concerns and sees the weakness as a buying opportunity.
The analyst believes NEXT's exclusive partnerships with established anode material suppliers are underappreciated by the market amid an attractive relative valuation to peers currently.
Ultimately, NEXT solves the downstream need to diversify away from the Chinese-dominant battery material supply without the major development risks associated with a new entrant, added Fiedler.
Price Action: NEXT shares are trading lower by 0.42% at C$2.35 on TSX and NSRCF higher by 1.38% at $1.84 on the last check Thursday.
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