Liontown Resources (ASX:LTR) raised AU$266 million of fresh equity via a placement, and the equity provides a buffer of around 18 months for spodumene SC6 spot prices to rise around 50%, Jarden said in a note on Friday.
The investment firm forecasted that the spodumene price needed to average around $1,100-per-tonne in fiscal 2026 and around $1,000-per-tonne in fiscal 2027 for Liontown to reach free cash flow breakeven.
It added that it is more conservative on the ramp-up of underground volumes, but "more positive" on Liontown achieving higher plant recoveries when targeting a spodumene SC5.2 product.
It decreased its earnings before interest, taxes, depreciation, and amortization forecast by around 22% in fiscal 2025, around 96% in fiscal 2026, and around 32% in fiscal 2027. Liontown's September quarter results are expected to be weak.
The investment firm downgraded Liontown to underweight from neutral while raising the price target to AU$0.50 from AU$0.48.
Liontown Resources' shares tumbled 8% in recent Friday trade.