It looks set to be another positive day of trade for the Syrah Resources Ltd (ASX: SYR) share price on Thursday.
At the time of writing the graphite miner's shares are up 9% to $1.30 following the release of an update on its Balama operations during the first quarter.
This gain means that Syrah's shares have now rallied 29% over the last three trading days.
What was in today's update?
Investors have responded positively to news that Syrah has outperformed its guidance during the first quarter.
According to the release, the company achieved production of 48kt during the quarter, compared to guidance of 45kt.
It sold 48kt of graphite, which was at the upper end of its guidance range of between 45kt and 50kt.
Also at the upper end of its guidance range was the weighted average price achieved, which came in at US$469 per tonne.
Though, this was significantly lower than its previous guidance of between US$500 and US$600 per tonne and driven by the company's decision to progress towards close out of lower priced contract volumes from 2018.
Finally, the company finished the period with cash of US$62 million, notably higher than its guidance of between US$55 million and US$57 million.
Should you invest?
I would like to see a sustained increase in the price of its graphite before considering an investment in the company.
As I'm not overly confident that prices will increase materially this year, I intend to stay clear of its shares and those of lithium miners Orocobre Limited (ASX: ORE) or Pilbara Minerals Ltd (ASX: PLS).
But I will be keeping an eye on how things develop, because if prices do improve significantly then Syrah's shares could prove to be a bargain buy at current levels.
