The Pilbara Minerals Ltd (ASX: PLS) share price is plummeting today.
The lithium explorer’s shares have fallen 17.3% at the time of writing. For perspective, the S&P/ASX 200 Materials Index (ASX: XMJ) is down 0.98% so far.
Let’s take a look at what could be impacting the Pilbara Minerals share price.
Lithium price outlook
Pilbara Minerals shares are falling, but they are not the only lithium share to plunge. The Core Lithium Ltd (ASX: CXO) share price is down nearly 12% today, Liontown Resources Ltd (ASX: LTR) is 16% lower, and Allkem Ltd (ASX: AKE) is sliding 12%.
Investors could be selling down lithium shares after Goldman Sachs put out a note warning of a “sharp correction” in lithium prices in the next two years.
Goldman has predicted the lithium price could fall from US$60,350 per tonne to around US$54,000 per tonne in 2022. But, by 2023, Goldman estimates lithium could fall to US$16,372 per tonne.
In a recent note cited by Bloomberg, Goldman analysts Nicholas Snowdon and Aditi Rai predicted the “battery metals bull market” is over“. The analysts said:
Investors are fully aware that battery metals will play a crucial role in the 21st century global economy.
Yet despite this exponential demand profile, we see the battery metals bull market as over for now.
Goldman is also predicting the price of nickel and cobalt to fall in 2022 and 2023.
Meanwhile, following the Goldman report, Credit Suisse has downgraded Pilbara Minerals from “outperform” to “neutral”, The Australian reported. The broker has placed a price target of $3 on the company’s share price.
Pilbara is developing the Pilgangoora Lithium Tantalum Project in Western Australia.
In overseas markets, the Lithium Americas Corp (NYSE: LAC) share price tanked nearly 13% on the New York Stock Exchange on Tuesday. However, in after-hours trading in the US, it is recovering slightly, up 1.83%.
Share price snapshot
The Pilbara Minerals share price has soared 104% in the past year but has dropped 21% year to date.
For perspective, the S&P/ASX 200 Materials Index has climbed nearly 4% over the past 12 months and more than 6% so far this year.
Pilbara Minerals has a market capitalisation of about $7.5 billion.
The post Why is the Pilbara Minerals share price cratering 17% today? appeared first on The Motley Fool Australia.
Should you invest $1,000 in Pilbara Minerals right now?
Before you consider Pilbara Minerals , you’ll want to hear this.
Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Pilbara Minerals wasn’t one of them.
The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.
*Returns as of January 13th 2022
More reading
- Why are ASX lithium shares tanking on Wednesday?
- ASX 200 midday update: NAB completes acquisition, lithium miners sink, Origin tumbles
- These were the best performing ASX 200 shares in May
- Why has May been such a great month for the Allkem share price?
- Here are the 3 most traded ASX 200 shares on Tuesday
The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
from The Motley Fool Australia https://ift.tt/4taQSHf
Leave a Reply