What's behind the rise and fall of Clean TeQ Holdings Limited shares

Clean TeQ Holdings Limited (ASX:CLQ) delivered shareholders with staggering returns for years. But things have changed…

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Clean TeQ Holdings Limited (ASX: CLQ) shareholders collected big gains from a company that looked set to cash in on rising demand for cleaner energy sources.

As governments around the world pledged to tackle pollution concerns through various measures in 2017, such as increasing incentives for the uptake of electric vehicles, the hopeful miner of key battery making ingredients watched its share price skyrocket.

In early 2015, Clean TeQ's shares were trading for about 6 cents but had climbed above $1.60 towards the end of 2017, representing a gain of more than 2,550% over that period.

Clean TeQ's shares have since tumbled and are now going for about 58 cents.

What happened?

The simple answer is: not much.

There have been reports of cost blowouts or complications with offtake agreements but essentially it appears that Clean TeQ has proved it is a company whose share price is highly susceptible to the whims of the news cycle.

Clean TeQ said its mission was to produce metals that "are highly geared to disruptive changes in technologies and markets, particularly in global energy and transport".

The company said it was focussed on nickel and cobalt, key battery making ingredients, and planned to build one of the biggest cobalt mines in the world.

But Clean TeQ's shares have been trading for more than 10 years with the company yet to turn a profit.

Clean TeQ reported a loss exceeding $12 million for FY17 which followed the company's loss of about $6.5 million for FY16.

It's difficult to tell when, or if, Clean Teq will start turning a profit and allow investors a clearer picture by which to evaluate the company with a market cap of around $460 million.

As such, if you're looking for exposure to companies that are positioned to profit from rising demand for cleaner energy sources, it would be better to consider companies such as  Galaxy Resources Limited (ASX: GXY) or Orocobre Limited (ASX: ORE).

If you're looking for something a bit more interesting, feel free to check this out…

Motley Fool contributor Steve Holland has no position in any of the stocks mentioned. 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 Scott Phillips.

More on ⏸️ Investing

A white and black robot in the form of a human being stands in front of a green graphic holding a laptop and discussing robotics and automation ASX shares
Technology Shares

Joining the revolution: How I'd invest in ASX AI shares right now

Advances in artificial intelligence (AI) could usher in a new industrial revolution. Here’s how you can invest in it.

Read more »

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

Two people in suits arm wrestle on a black and white chess board.
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »