I guess this perfectly begs the question, what will be the catalyst to begin the reversal for PLS.
Since the share price highs earlier this year in the high $3s, what has happened/change?
1. SC6 price has continued its incredible rise, in both spot and contract pricing. In my opinion, the price has begun o tail off and stabilize, if it stabilizes around the $5k USD SC6 for contract pricing we should all rejoice…
2. The vast majority of financiaL institutions have clued on to the fact that current producers will be printing money for the foreseeable future. IMHO there is a big shift underway T the moment for the big banks rotating into producers.
3. Our great friends at GS produced one of the most ill informed bits of literature I think any of us have ever read. Despite this, the uninformed sheep followed the dopey shepherd and the sell off began.
4. US inflation, rates and general fear in the market is rearjng its ugly head. Ultimately, does this impact PLS?…my thoughts below pertaining to point 4:
- Higher inflation and interest rates may make it more difficult for juniors and explorers to obtain funding.
- Undersupply will continue to cripple the electrification revolution. The magical 6 mines that BYD have found will not be producing in the next 5 years….
- PLS, with cash in the bank, will be able to fund their downstream and expansion ventures without an issue, whilst still printing money
Markets go up and down, they are not rational, and even if PLS were reporting massive profits, the market would be in the deep red today regardless.
Nothing fundamentally changes over the next 12-36 months. Undersupply will continue. SC6 pricing will remain strong. PLS will continue to produce and sell their product for record profits. Car OEMs will continue to spend billions on electrifying their fleet. Mum and dads (now more so than ever), will hold off on their next car purchase to make sure it’s an electric one.
Apologies for the mini rant, but I am more confident than ever that PLS will bounce back to ATHs once everyone takes a deep breath, and the rotation back into the lithium producers continues. IMO this won’t be until the next FY, June will be
more of the same….
GLTAH Pap
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