The S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) is up just 1.4% since the start of this year, but that hasn’t stopped these 10 companies soaring more than 60% higher in just over two months.
Here’s a closer look at those 10 companies.
|Company||Sector||Share Price||Market Cap ($m)||Price change|
|Equator Resources Ltd (ASX: EQU)||Diversified Metals and Mining||$0.17||$92.6||204%|
|SKY and Space Global Ltd (ASX: SAS)||Alternative Carriers||$0.25||$128.9||199%|
|Macphersons Resources Ltd (ASX: MRP)||Gold||$0.21||$66.6||163%|
|Greenland Minerals and Energy Limited (ASX: GGG)||Diversified Metals and Mining||$0.17||$164.9||150%|
|Global Geoscience Limited (ASX: GSC)||Diversified Metals and Mining||$0.14||$149.3||106%|
|Clean TeQ Holdings Limited (ASX: CLQ)||Environmental and Facilities Services||$1.02||$488.4||104%|
|Avanco Resources Limited. (ASX: AVB)||Diversified Metals and Mining||$0.13||$319.4||91%|
|Cardinal Resources Ltd (ASX: CDV)||Gold||$0.43||$130.7||91%|
|Mod Resources Ltd (ASX: MOD)||Diversified Metals and Mining||$0.06||$101.1||82%|
|Danakali Ltd (ASX: DNK)||Diversified Metals and Mining||$0.79||$177.5||64%|
Source: Yahoo Finance, S&P Global Markets Intelligence
Interestingly, a whopping nine out of ten of the companies are smaller resources companies involved in several commodities from iron ore, potash, lithium, boron, nickel and cobalt to scandium, copper and gold. Just one company, Sky and Space Global Ltd develops nanosatellites and associated communications infrastructure. Clean TeQ Holdings’ primary focus is the Syerston nickel/cobalt/scandium mining project in NSW, despite its Environmental and Facilities sector allocation.
Huge demand for renewable energy
It’s clear that investors think rising demand for raw materials used by the renewable energy sector for products like batteries, electric cars, electricity storage, wind turbines and many other similar products will be of enormous benefit to these companies. Potash is also expected to be in demand as a raw ingredient in fertiliser to increase the world’s food production as the population grows.
The only problem for investors is that most small resource plays never end up making it into the big league because they run out of cash, get taken over by those with larger pockets, or their projects end up being unprofitable.
For those who want to speculate, feel free to have a punt, as long as you realise the odds are against you. For my money, I’d stick to proven industrial stocks over the long term.
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The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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