PLS Group Ltd (ASX: PLS) shares have been on a tear over the past 12 months.
During this time, the lithium giant’s shares have rallied over 120%.
But that is barely even half of the story. At one stage last year, its shares were as low as $1.07.
On Wednesday, they closed the session at $4.87, which means a gain of over 350% from bottom to top.
Is it too late to buy PLS shares? Let’s see what analysts at Bell Potter are saying about the lithium miner.
What is the broker saying?
Bell Potter has been looking ahead to the company’s upcoming update and expects a solid quarter.
While production is expected to be down slightly quarter on quarter, the broker believes that higher lithium prices will drive a strong increase in revenue. It said:
We expect December 2025 quarterly production of around 214kt at unit costs of A$579/t FOB, marginally below the September 2025 quarter (225kt at A$540/t FOB) with potential weather impacts and higher levels of contact ore processed.
Quarterly revenue will improve (BP est. $323m; September 2025 quarter $251m), supported by higher realised prices. PLS are guiding to FY26 SC production of 820-870kt at unit costs A$560-600/t FOB and capex of A$300-330m. Construction of the mid-stream demonstration plant is complete; we expect the PLS (55%) – Calix (45%; CXL, not rated) JV will provide an update on commissioning and ramp-up timing.
Are PLS shares a buy, hold, or sell?
According to the note, the broker has upgraded PLS shares to a hold rating (from sell) with an increased price target of $4.55 (from $2.65). This implies potential downside of 6.5% from current levels.
Commenting on its hold recommendation, Bell Potter said:
EPS changes as a result of these upgrades are: FY26 now 12.3cps (previously 1.2cps); FY27 now 18.8cps (previously 2.5cps); and FY28 now 18.7cps (previously 4.5cps). Our PLS valuation is now $4.55/sh (previously $2.65/sh).
We upgrade our recommendation to Hold, reflecting improving lithium market fundamentals that will materially strengthen PLS’ earnings and cash flow generation. PLS is a low-cost producer with around 250ktpa of idled spodumene concentrate capacity that can be rapidly reactivated as conditions improve. Its Colina Project provides low-cost growth optionality in a supportive mining jurisdiction in Brazil.
In light of this, investors may want to wait for a meaningful pullback in the PLS share price before considering a position in the lithium miner.
The post Are PLS shares a buy, hold, or sell? appeared first on The Motley Fool Australia.
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More reading
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- PLS Group shares: After a year of outperformance, is it still a buy?
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