Is it too late to buy Pilbara Minerals (PLS)?

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Question asked 08/10/2022

Is it too late to buy Pilbara Minerals (PLS)?

Hi there! Great work :-) Pilbara Minerals: Is it too late to acquire this stock or is this a long-term growth company that will just keep rising, a bit like how CSL used to be? I remember Goldman Sachs saying Lithium was due for a big fall when the opposite has played out so far. The other interesting thing about PLS is that the other Lithium stocks haven't run nearly so hard and have had larger pullbacks. Is there any meaning to all of this or is PLS just a crowded trade that will have a big fall soon? Regards, Kim

Answer

Hi Kim,

Pilbara (PLS) is certainly the quality end of the lithium space and its +70% appreciation year to date, making fresh all-time highs in the process, is testament to this in what’s been a tough year for most stocks.

We continue to hold PLS but have removed our “Active” stance which means we wouldn’t be chasing at current levels but there’s certainly no obvious reason, fundamental or technical, to exit the stock, although we may trim our holding given its 100% appreciation from an original 4% weighting means it is now nearer 8% of the Emerging Companies Portfolio.

Its a big call to compare PLS to CSL but the EV theme is certainly here to stay but lithium is still a commodity and as such cyclical in nature even if the demand side looks set to continue to grow over decades to come.

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Pilbara Minerals (PLS)

LAST UPDATED 07/10/2022 12:26

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