Pilbara Minerals shares (ASX:PLS) have experienced a rollercoaster month of trading, marked by a net 13.48% gain in its share price, after an earlier decline. The recent rally off lows, now more than 40% offer a glimmer of hope to investors battered by the past year’s lithium price slump, and a stock that remains down 30% since the start of the year.
The boost in Pilbara Minerals’ share price can be attributed to several factors. On June 11, the company announced a substantial 23% increase in its mineral resource at the Pilgangoora Operation, bringing the total resource to 446 million tonnes at 1.28% lithium oxide.
This positive news was well-received by the market, reinforcing Pilgangoora’s position as one of the world’s largest hard-rock lithium deposits. CEO Dale Henderson’s emphasis on optimizing operations and unlocking the asset’s full potential further fueled investor optimism.
Adding to the positive momentum, lithium prices experienced a brief uptick in early July, driven by market movements in China and spurred by economic stimulus hopes. This surge was attributed to strengthened market sentiment and a positive outlook on global demand growth, despite lingering concerns about oversupply.
Furthermore, institutional investor confidence appeared to be growing, as AustralianSuper Pty Ltd increased its voting power in Pilbara Minerals from 10.49% to 11.54% on June 18. This move signalled a vote of confidence from a major player, potentially influencing the company’s strategic decisions and shareholder dynamics.
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Looking ahead, the upcoming earnings estimates are not particularly encouraging. For the next half-year, consensus earnings are estimated at A$0.02 per share, significantly lower than the A$0.07 per share reported in the last half-year, which matched expectations.
PLS’ gain of 3.18% today compares well to the broader ASX 200, down 0.61% leading into the close.
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