PLS Group Ltd (ASX: PLS) shares are trading in the green this week. The ASX lithium stock has gained 21% over the past month and nearly 140% over the last 12 months, at the time of writing.

The question for investors is whether the rally can continue after PLS Group delivered a remarkably strong FY2026 result.

The latest earnings report, released on Monday, showed just how dramatically the lithium market has improved.

Profit and revenue surge

Higher lithium prices and stronger market confidence provided a major boost to PLS’ financial performance.

The company’s realised selling price jumped 121% to US$1,488 per tonne. That helped revenue surge 152% to $1.9 billion, while net profit after tax (NPAT) exploded 369% higher to $528 million.

The company also improved its underlying operations. Unit operating costs (FOB) fell 9% to $569 per tonne, while sales volumes reached a record level. PLS Group also strengthened its balance sheet, helped by a successful US$600 million bond issue.

Management of PLS shares says the business enters FY2027 “larger, lower cost” and with significantly stronger finances and greater flexibility.

From defense to growth

The company plans to build on that position by progressing growth projects including P2000 and Colina, while ramping up production at Ngungaju.

During the year, the improving lithium environment allowed Pilbara Minerals to shift from defensive positioning towards growth. It restarted the Ngungaju processing plant and updated timelines for the P2000 and Colina projects.

The P2000 and Colina feasibility studies have also progressed, with the company approving approximately $175 million of pre-FID capital expenditure for P2000 in June.

There won’t be many ASX companies with a market capitalisation above $10 billion delivering this level of growth during the current reporting season.

Are PLS shares still a buy?

Despite the impressive numbers, investors may need to be more selective after such a huge share-price rally.

Bell Potter believes PLS shares may have peaked for now. The broker retained its hold rating on Tuesday morning but increased its price target from $4.70 to $5.20. With PLS shares currently trading at $5.15, this suggests they are near fair value.

TradingView data shows a divided analyst community. Nine of 18 brokers rate the stock a buy or strong buy, while the average price target is $5.36, slightly above the current share price.

The most bullish forecast sees PLS shares climbing 28% to $7.00. At the other end of the spectrum, the most pessimistic forecast points to a potential 40% decline.

So, while PLS Group’s fundamentals have improved dramatically, the share price may already reflect much of that optimism. After a 140% gain over 12 months, investors should weigh the company’s strong growth prospects against lithium price volatility and valuation.

The post Up nearly 140%, are PLS shares still a buy after exploding profit growth? appeared first on The Motley Fool Australia.

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Motley Fool contributor Marc Van Dinther has no position in any of the stocks mentioned. 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.

On Tuesday, the S&P/ASX 200 Index (ASX: XJO) was on form and raced higher. The benchmark index rose 0.7% to 9,164.6 points.

Will the market be able to build on this on Wednesday? Here are five things to watch:

ASX 200 to rise

The Australian share market looks set for a good session on Wednesday following a positive night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 31 points or 0.35% higher. In the United States, the Dow Jones rose 0.3%, the S&P 500 climbed 0.3%, and the Nasdaq charged 0.65% higher.

Oil prices sink

ASX 200 energy shares including Beach Energy Ltd (ASX: BPT) and Santos Ltd (ASX: STO) could have a tough session on Wednesday after oil prices sank overnight. According to Bloomberg, the WTI crude oil price is down 5% to US$80.81 a barrel and the Brent crude oil price is down 6% to US$86.63 a barrel. This was driven by easing US-Iran war fears.

Buy EOS shares

In response to its results on Tuesday, Bell Potter has retained its buy rating and $12.60 price target on Electro Optic Systems Holdings Ltd (ASX: EOS) shares. It said: “EBITDA was $21.6m (4% beat vs. BPe) driven by higher-than-expected gross margins offset partially by higher opex which reflected a 42% YoY expansion in headcount as EOS scales geographic presence for further order book growth plus MARSS sign on bonuses.. […] Retain Buy. EOS is positioned as a C-UAS market leader leveraged to increasing budget allocations to C-UAS tech. The next 3-12 months is catalyst rich for EOS.”

Gold price rises

ASX 200 gold shares Westgold Resources Ltd (ASX: WGX) and Northern Star Resources Ltd (ASX: NST) could have a good session on Wednesday after the gold price rose again. According to CNBC, the gold futures price is up 0.45% to US$4,719 an ounce. Traders bid the gold price close to a three-month high on US dollar weakness.

More ASX 200 results

Another group of ASX 200 shares will be releasing their results on Wednesday and will be on watch. This includes counter-drone technology company DroneShield (ASX: DRO), pizza chain operator Domino’s Pizza Enterprises Ltd (ASX: DMP), supermarket giant Woolworths Group Ltd (ASX: WOW), investment platform provider Netwealth Group Ltd (ASX: NWL), and logistics technology company WiseTech Global Ltd (ASX: WTC).

The post 5 things to watch on the ASX 200 on Wednesday appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Domino’s Pizza Enterprises, WiseTech Global, and Woolworths Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Domino’s Pizza Enterprises, DroneShield, Electro Optic Systems, Netwealth Group, and WiseTech Global. The Motley Fool Australia has positions in and has recommended Netwealth Group and WiseTech Global. The Motley Fool Australia has recommended Domino’s Pizza Enterprises. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

BHP Group Ltd (ASX: BHP) shares surged to a new all-time record $68.22 on Tuesday, taking their 2026 gain to 48% and 12-month return to 58%.

That’s great news for BHP shareholders — myself included.

More than five years ago, I made one of my first Australian share purchases: BHP shares. So, how has that early bet worked out?

Let’s run the numbers.

$25,000 in BHP shares

At the end of 2020, I backed the $330 billion ASX mining giant at $36.63 per share. I invested $24,987 to buy 682 BHP shares.

What followed was an extraordinarily volatile five years. The investment began amid pandemic uncertainty, with commodity prices swinging wildly and BHP shares briefly falling into the low $30s.

Then came the commodity boom. Iron ore prices surged, BHP’s profits ballooned and the stocks climbed above $50 during 2021 and 2022.

The cycle eventually turned. China’s property slowdown weighed on iron ore and mining stocks, pushing BHP back towards the high $30s before the shares recovered.

The income and capital gains

With BHP shares now around $67, my original 682 stocks would be worth approximately $45,694. That represents a capital gain of about $20,707 before dividends.

But BHP isn’t just a capital-growth story. Its dividends have been a major part of the investment return. Over the five-year period, the miner paid approximately $19 per share in dividends. Across 682 shares, that equates to around $12,958 in income.

Add that to the capital value and the investment has generated roughly $58,650 in total value if dividends were taken as cash. That’s more than double the original investment.

Reinvesting the dividends

However, I opted to participate in BHP’s dividend reinvestment plan (DRP).

Assuming the dividends were reinvested at an average share price of around $51, the original 682 BHP shares could have grown to approximately 806 shares. At $67 per share, that holding would now be worth roughly $54,002.

Compared with the original $24,987 investment, that’s a gain of more than $29,000.

And the benefit doesn’t stop there. Owning more shares means future dividends are calculated on a larger holding.

The DRP effectively turned volatility into an opportunity. When BHP shares traded in the $30s and $40s, reinvested dividends bought more shares. When the mining cycle recovered, those additional shares amplified the gains.

Was the BHP investment worth it?

The past five years demonstrate two important things about BHP shares.

First, the mining giant remains highly cyclical. Investors need to stomach significant swings driven by commodity prices and global demand.

Second, when the commodity cycle works in BHP’s favour, its combination of earnings growth and substantial dividends can be powerful.

For a patient investor willing to ride out the volatility, my $25,000 BHP investment has turned into a holding worth more than $54,000.

Not bad for one of my first ASX share purchases.

The post I put $25,000 into BHP shares 5 years ago. Here’s what it’s worth now appeared first on The Motley Fool Australia.

More reading

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• How I’d use ASX shares to build a second source of wealth
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• Buy, hold, sell: Judo Capital, Healius, BHP shares
• BHP share price hits new record high

Motley Fool contributor Marc Van Dinther has positions in BHP Group. 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 recommended BHP Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.&amp;amp;amp;lt;/em&amp;gt;</p>