The Pilbara Minerals Ltd (ASX: PLS) share price has somewhat flown under the radar in 2020.
After a disappointing 2019, in which the group’s shares crashed 61.64% lower, the Aussie lithium miner is climbing higher again.
Pilbara shares are up 33.33% in the last month, despite slumping 5.90% lower in early trade this morning.
So, what’s driving the Pilbara Minerals share price higher and is there still time to buy?
Why the Pilbara Minerals share price has rocketed higher
The Aussie lithium miner has been the beneficiary of renewed optimism in global lithium demand.
One of the biggest factors to start 2020 has been the remarkable turnaround from car manufacturer, Tesla.
The group delivered its Shanghai-made Tesla Model 3 cars as demand continues to grow for the electric vehicle.
Also helping ASX lithium shares has been China’s decision to maintain electric vehicle (EV) subsidies. The expectation of increased production and therefore demand for battery materials has sent the Pilbara Minerals share price soaring higher in January.
Orocobre shares are up 29.18% for the year while Galaxy shares are up 22% in the same time.
Should you buy the ASX lithium miners?
At this stage, I don’t think I’ll be buying in.
The sharp spike in the Pilbara Minerals share price after a disappointing 2019 has me wary. Despite positive sentiment, global lithium prices remain low and that’s a worry.
Australia and Chile have the largest lithium deposits in the world, which puts them in the box seat for a coming electric vehicle boom. The recent Tesla battery storage experiment in South Australia could also be a sign of things to come.
However, until earnings are actually on the rise and these companies are profitable, I won’t be diving into the speculation just yet.
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Motley Fool contributor Kenneth Hall 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.