Lithium price rebound ignites expectations: Deutsche Bank raises Sociedad Quimica y Minera de Chile S.A. Sponsored ADR Pfd Series B (SQM.US) target price to $105, with a potential upside of nearly 40%.

Deutsche Bank Aktiengesellschaft recently released a special research report on Sociedad Quimica y Minera de Chile S.A. Sponsored ADR Pfd Series B (SQM.US), combining the company's performance outlook for the second quarter of 2026 and its performance in the fourth quarter of 2025. The report presents a quarterly series of long and short views, highlighting the core points of contention for investors in the stock, ultimately maintaining a buy rating with a target price of $105. The bank wrote in the report that they are maintaining a buy rating on Sociedad Quimica y Minera de Chile S.A. Sponsored ADR Pfd Series B. The core logic is that the company is deeply involved in the lithium spot market and will benefit from rising lithium prices in the coming quarters. The stock price on the day of the report was $77.69, with a 52-week trading range of $30.03 to $95.31. As of the time of writing, the stock has increased by 3.99%, to $75.66. In terms of market performance and valuation, over the past three months, the stock prices of lithium sector companies have shown mixed trends, with Sociedad Quimica y Minera de Chile S.A. Sponsored ADR Pfd Series B's price rising by 8%, lagging behind PLS Group (PLS.US), Lithium Argentina (LAR.US), and outperforming Albemarle Corporation (ALB.US); meanwhile, the S&P 500 index rose by 10%. In terms of valuation, based on estimated data for 2026, Sociedad Quimica y Minera de Chile S.A. Sponsored ADR Pfd Series B's EV/EBITDA ratio is 7 times, lower than its peer Albemarle, and the valuation of the two is expected to be essentially the same in 2027, indicating room for the company's valuation to rise. The bank mentioned four major bullish logic points: 1. Second quarter and 2026 performance are expected to exceed expectations According to the calculation model, Sociedad Quimica y Minera de Chile S.A. Sponsored ADR Pfd Series B has upward potential in adjusted EBITDA for the second quarter and full year of 2026. The bank's profit forecasts for these two periods are 2% and 9% higher than market expectations, driven mainly by an increase in lithium prices and volume for iodine and special nutrition products, providing strong support. 2. Lithium industry sentiment continues to improve Sociedad Quimica y Minera de Chile S.A. Sponsored ADR Pfd Series B is a globally leading and cost-effective lithium producer, highly exposed to the lithium spot market, with lithium prices being the primary factor affecting its stock price. The lithium market has shown signs of recovery since mid-2025, with a clear warming trend over the past six months. Deutsche Bank Aktiengesellschaft predicts that the average price of lithium products for Sociedad Quimica y Minera de Chile S.A. Sponsored ADR Pfd Series B will reach $18.6/kg in 2026, compared to $8.9/kg in 2025. The increase in lithium prices will significantly increase the company's EBITDA and further drive stock price growth. 3. Rising lithium prices are expected to boost shareholder returns It is widely expected in the market that the company will increase shareholder returns, with a high probability of issuing a special dividend. Although the company's management has not formally confirmed this during their first-quarter earnings call, they indicated that the plan is feasible and that final approval will be required from the board of directors. Looking back at the previous bull market cycle in the lithium industry, Sociedad Quimica y Minera de Chile S.A. Sponsored ADR Pfd Series B distributed special dividends as the main form of shareholder return: a total dividend of $10.94/share (dividend yield of 13%) in 2022 and $4.83/share (dividend yield of 7%) in 2023. 4. Non-lithium businesses also have growth potential Sociedad Quimica y Minera de Chile S.A. Sponsored ADR Pfd Series B has a diversified business structure, with main products including lithium, iodine, special nutrition products (SPN), industrial chemicals, and potassium fertilizers. In the past two years, the iodine market has shown strength in both volume and price, a trend expected to continue in the following quarters. The bank predicts a 3% year-on-year growth in iodine product sales in 2026, with a price of $72/kg. Due to the political situation affecting GEO Group Inc, the sale of special nutrition products (SPN) has recently improved, with product sales expected to grow by 10% in 2026, reaching a total sales volume of 1.114 million tons for the year. The diversified product structure provides a natural hedge: when lithium prices rise, the company benefits from industry dividends; when lithium prices fall, other businesses can offset profit fluctuations, effectively smoothing the company's overall EBITDA and free cash flow levels. At the same time, the report also highlighted two potential risks. One is the risk of lithium price fluctuations. Despite institutions being optimistic about the industry achieving supply and demand balance in 2027, the high volatility of lithium prices may deter investors with lower risk preferences from taking action. The second risk is the supply pressure brought about by capacity restarts. In 2026, several lithium mines in Australia have resumed production, and if domestic lithium mines also restart, it will further exacerbate market volatility, as the market has already priced in some expectations of increased capacity. In terms of historical ratings, from 2023 to the first half of 2025, institutions mainly rated Sociedad Quimica y Minera de Chile S.A. Sponsored ADR Pfd Series B as "neutral" with continuously decreasing target prices. Starting in 2026, as the industry recovered, the rating was changed back to "buy" with continuously increasing target prices.