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Why these seasoned investors are watching the Pilbara (ASX:PLS) share price

A surge in global battery production is seeing strong demand for lithium.
The post Why these seasoned investors are watching the Pilbara (ASX:PLS) share price appeared first on The Motley Fool Australia. –

The Pilbara Minerals Ltd (ASX: PLS) share price stands at $2.15 at time of writing, right where it closed yesterday.

But Pilbara’s share price isn’t well-known for its lack of movement.

Shares in the S&P/ASX 200 Index (ASX: XJO) lithium producer leapt 26% in August alone.

August’s gains were partly driven by strong lithium prices as investors look to long-term growth in global battery demand.

August also saw the company report an impressive 109% year-on-year leap in revenue for FY21 to $175.8 million.

Not surprising then, that Pilbara made the top-10 list of most popular traded shares among Saxo Capital Markets’ Australian clients in August. And this list isn’t exclusive to ASX shares. It includes international shares as well.

What did Saxo report on Pilbara?

Pilbara came in at number 9 on Saxo’s list of top-10 most popular traded shares last month among its Aussie clients.

Saxo said this came after the lithium mining giant delivered, “hugely promising FY21 results. The firm revealed it had increased its cash gross margin to AU$46.2 million in the 12 months to 30 June 2021”.

According to Saxo:

Pilbara Minerals’ managing director Ken Brinsden described their results as an “incredible turnaround”, particularly “during the second half of FY 2021”. Brinsden cited the surge in demand for lithium raw materials worldwide as the basis for generating “substantial increases” in its products.

Pilbara also offered some positive guidance, despite anticipating higher costs in the year ahead. It forecast shipments will continue to increase in the 2022 financial year. “Shipments are expected to total 440,000 to 490,000 dmt for the full year, which would represent a year-on-year increase of between 56% and 74%.”

As at 30 June, Pilbara Minerals had a cash balance of $115.7 million.

Pilbara share price snapshot

If you’d invested in Pilbara 1-year ago you’d be sitting on paper gains of 572% today. To put that in some perspective, over that same time the ASX 200 is up 25%.

2021 has seen the Pilbara share price continue to outperform, up 147% year-to-date.

The post Why these seasoned investors are watching the Pilbara (ASX:PLS) share price appeared first on The Motley Fool Australia.

Should you invest $1,000 in Pilbara right now?

Before you consider Pilbara, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Pilbara wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

Leading broker reveals why these 10 big-name shares have been firing up its clients

Here are the 3 most heavily traded ASX 200 shares today

5 ASX shares under $10 that have more than doubled in the past year

Here are the 3 most traded ASX 200 shares this Monday

Why the Pilbara Minerals (ASX:PLS) share price is sinking 7% on Monday

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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