Why is the Prospect Resources (ASX:PSC) share price up 11% this month?

Here's what's been driving the Prospect Resources share price higher in September.

The Prospect Resources Ltd (ASX: PSC) share price is performing well in September.

While the company has released good news this month, its share price is seemingly moving independently.

At the time of writing, the Prospect Resources share price is 40 cents, 11.11% higher than it was at the end of August.

Let's take a look at the latest news from the lithium and gold producer.

high, climbing, record high

Image Source: Getty Images

The month so far for Prospect Resources

The Prospect Resources share price is having a great month on the ASX.

It comes after the company released an update on the sale of its Penhalonga Gold Project.

The project's buyer, Luzich Resources, has executed an options agreement for the purchase and has agreed to pay the remaining US$750,000 balance on the US$1 million purchase price.

Luzich paid a deposit on the project when it signed a binding term sheet in October 2020.

According to Prospect Resources' website, the Penhalonga Gold Project is the only gold project currently held by the company.

After its sale, it will focus all its efforts on its Arcadia Lithium Project.

The Prospect Resources share price didn't react to the update on the sale. However, it has since gained 11%.

The sale might not be the only catalyst for the Prospect Resources share price's recent boost.

The price of lithium has been gaining steadily in September and it might be dragging Prospect Resources' stock along with it.

According to S&P Global Platts, the price of lithium carbonate has been gaining this month as concerns surrounding global supply have increased demand.

Prospect Resources share price snapshot

September's gains have added to Prospect Resources' strong performance on the ASX.

Right now, the company's share price is 135% higher than it was at the start of 2021. It has also gained 150% since this time last year.

The company has a market capitalisation of around $157 million.

Motley Fool contributor Brooke Cooper 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 Bruce Jackson.

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