Pilbara Minerals, Australia's biggest lithium play remains one of the most shorted stocks. Gains CATL as a client
Pilbara Minerals $Pilbara Minerals Ltd (PLS.AU)$ shares have outperformed the Aussie share market, and gained 5% this year. Pilbara Minerals has come a long way from just having Great Wall as a client and they now sell lithium to the world's biggest battery maker, CATL.
If you are a patient investor and like the idea of being invested in Australia's biggest lithium company who continues to grow their client book, then you could consider investing in Pilbara Minerals. But you need to be careful. Here is why…
At the Australian Shareholders Association (ASA) Annual Conference I presented Buy Hold Sell, covering 20 stocks alongside Henry Jennings on Sunday May 19 2024. Pilbara Minerals was one of the 20 stocks I covered.
Aussies seem to love Pilbara Minerals and so do ETFs; $Pilbara Minerals Ltd (PLS.AU)$ is the biggest exposure to Lithium on the ASX. It was Australia's first profitable lithium producer and it's Australia's largest. But at the conference we covered that PLS been one of the most shorted stocks in the ASX of late and this year. So we need to be careful when investing in this.
Below is what you need to know about PLS:
- PLS shares + 5% YTD.
- Over the last four weeks, PLS' earnings have been downgraded. We need to careful with that.
- Its revenue +241.6% in 2023. Rev' expected to fall 69% his year.
- PLS is commodity driven. The Lithium price is up 9% this year off its low. But it's still down 63% from 2023 high. And down 80% from its 2022 record. What is the concern is that oversupply is expected in the lithium market till 2027-2029.
- Profitable business. Net income growth of 16.9% last year.
- Biggest customers are CATL (the world's biggest battery maker) , Ganfeng $Ganfeng Lithium Group (002460.SZ)$ which is Chian's biggest lithium company. General Lithium, Great Wall $Great Wall Motor (601633.SH)$ and Posco $POSCO (PKX.US)$. Pilbara Minerals has come a long way from just having Great Wall as a client.
- Its suppliers are NRW $NRW Holdings Ltd (NWH.AU)$ and Woodside $Woodside Energy Group Ltd (WDS.AU)$
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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151453268 witso : Pls was definitely on the radar a while back but the thought of a slow recovery due to renewable uptake uncertainty, governments and market hold ups made it disappear, i do like Renascor resources graphite due to the potential supply side and china cant continue to dilute the price for ever when they kick off maybe a watch.