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Just got this in an email ...Fri, 31 Mar at 9:31 am


Friday, 31 March 2023

PLS - PILBARA MINERALS LIMITED

Morgans rates PLS as Add (1) - In the wake of Albemarle's rejected takeover bid for Liontown Resources ((LTR)), Morgans sees potential for Pilbara Minerals to also become a takeover target due to its exposure to high quality hard rock.

Pilbara Minerals remains one of the few independent lithium producers with a globally significant resource, points out the analyst, allowing an acquirer immediate exposure to spodumene and hydroxide.

While the broker sees value in the Lithium sector, it cautions shorter-term traders that lithium price weakness continues, particularly in Chinese carbonate prices.

The $5.30 target and Add rating are retained and the stock becomes the broker’s key pick of the pure plays in the sector.

Target price is $5.30 Current Price is $3.99 Difference: $1.31 If PLS meets the Morgans target it will return approximately 33% (excluding dividends, fees and charges). Current consensus price target is $5.58, suggesting upside of 39.7%(ex-dividends)The company's fiscal year ends in June.

Forecast for FY23:

Morgans forecasts a full year FY23 dividend of 17.00 cents and EPS of 82.50 cents . At the last closing share price the estimated dividend yield is 4.26%. At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 4.84. How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 83.8, implying annual growth of 341.5%. Current consensus DPS estimate is 26.7, implying a prospective dividend yield of 6.7%. Current consensus EPS estimate suggests the PER is 4.8.

Forecast for FY24:

Morgans forecasts a full year FY24 dividend of 10.00 cents and EPS of 71.60 cents . At the last closing share price the estimated dividend yield is 2.51%. At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 5.57. How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 78.3, implying annual growth of -6.6%. Current consensus DPS estimate is 19.3, implying a prospective dividend yield of 4.8%. Current consensus EPS estimate suggests the PER is 5.1.

Market Sentiment: 0.8All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources