PLS, AKE, CXO: Three stocks worth watching in September 2022?

Highlights:

• The demand of Lithium has grown globally due to the booming electric vehicle revolution.
• The S&P/ASX 200 Materials sector (ASX:XMJ) is down 3.93% year to date and has fallen 2.96% in the last one year.
• It is predicted that for 2022, EV sales in China are anticipated to reach 6.4 million units, more than twice of 2021 levels.

At a time when global equities are witnessing a sell-off due to inflation and recession concerns, all the sectors are bearing the brunt of the challenging business environment. This article will discuss three ASX-listed lithium stocks on the investors’ radar lately. As known, the demand of Lithium has grown globally due to the booming electric vehicle revolution. If one looks at the performance of the materials sector on ASX, we see that at 16,434.60 points, the S&P/ASX 200 Materials (ASX: XMJ) is down 3.93% year to date and has fallen 2.96% in the last one year.

The lithium prices last week moved up as the demand for this commodity surpassed the demand. The big numbers from various global lithium miners and update related to mega supply deals have set tone for various stocks from this space

It is predicted that for 2022, EV sales in China are anticipated to reach 6.4 million units, more than twice of 2021 levels. Given the current situation, when it appears that there will be no more lockdown restrictions that can impede production, it can be said that the demand from the electric vehicle industry will accelerate in Q3.

With that said, let us have a look at the performance of three ASX-listed lithium companies, which will be on investors’ watchlist in September. These stocks include - Pilbara Minerals Ltd (ASX:PLS), Allkem Ltd (ASX:AKE), and Core Lithium Ltd (ASX: CXO).

Pilbara Minerals Ltd (ASX: PLS): 

On 30 August 2022, the share price of ASX-listed lithium miner Pilbara Minerals Ltd traded 2.578% up and settled at AU$3.580 per share by the end of day’s trade. In the last one year, Pilbara shares have gained almost 62.73%, and 29.2419% in the last one month. The company has a market capitalisation of AU$10.39 billion. 

Last week, Pilbara announced its full-year profit after tax of AU$561.8M for FY22. Pilbara has reported a 577% increase in revenue to ~$1.2B. The company has said that its positive performance is driven by strong global demand for lithium raw materials and favorable pricing conditions for spodumene concentrate, especially in the year's second half. 

Read our research report on AKE by clicking here, which was released 28 July 2022. The shares have improved ~36% since then.

Allkem Ltd (ASX:AKE):

On 30 August 2022, the share price of ASX-listed lithium company Allkem Ltd traded 1.595% up and settled at AU$14.010  by the end of day’s trade. In the last 12 months, the share price of Allkem Ltd has gained 59.93%, and 24.20% in the last one month. The company has a market capitalisation of AU$8.86 billion. In its FY22 results, revealed last week the company reported an increase of 800% in the Group revenue to US$770 million. The company's record revenue growth was driven by strengthened pricing and production of high-quality lithium products from the company's global operations.

Read our research report on AKE by clicking here, which was released 27July 2022. The shares have improved ~32% since then.

Core Lithium Ltd (ASX: CXO):

By the closure of market on 30 August 2022, the shares of Core Lithium Ltd surged 2.222% and settled at AU$1.380 per share. The past one-year return and one-month performance of Core Lithium Ltd stands at 311.94% and 19.48%, respectively. 

Today, Core Lithium has agreed with Tesla Inc. to extend the date of termination for its binding offtake term sheet with Tesla to 26 October this year. The extension permits Core and Tesla to conclude discussions for the said agreement.

The Offtake Term Sheet concerns the supply of up to 110,000 dry metric tonnes of lithium spodumene concentrates to Tesla. 

Read our research report on CXO by clicking here.

Customer Notice:

Nextgen Global Services Pty Ltd trading as Kapitales Research (ABN 89 652 632 561) is a Corporate Authorised Representative (CAR No. 1293674) of Enva Australia Pty Ltd (AFSL 424494). The information contained in this website is general information only. Any advice is general advice only. No consideration has been given or will be given to the individual investment objectives, financial situation or needs of any particular person. The decision to invest or trade and the method selected is a personal decision and involves an inherent level of risk, and you must undertake your own investigations and obtain your own advice regarding the suitability of this product for your circumstances. Please be aware that all trading activity is subject to both profit & loss and may not be suitable for you. The past performance of this product is not and should not be taken as an indication of future performance.

Kapitales Research, Level 13, Suite 1A, 465 Victoria Ave, Chatswood, NSW 2067, Australia | 1800 005 780 | info@kapitales.com.au