The Pilbara Minerals (ASX:PLS) share price has lost 17% in a month. What's going on?

Pilbara has been giving back some of its gains of late…

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Key points
  • Pilbara Minerals is one of the most popular ASX 200 shares on the market
  • The lithium producer has given investors a very healthy return over the past 5 years
  • But the company has been struggling more recently...

It's fair to say that the Pilbara Minerals Ltd (ASX: PLS) share price is one that punches above its weight. Although this lithium producer is a member of the S&P/ASX 200 Index (ASX: XJO), its market capitalisation of $8 billion or so pales in comparison to some of the other big miners on the ASX. Take Fortescue Metals Group Limited (ASX: FMG), which is worth more than $55 billion. Or BHP Group Ltd (ASX: BHP), with its $220 billion-plus size. 

Yet it is Pilbara shares that have given investors a 5-year return of more than 500%. And Pilbara shares that consistently dominate the ASX 200's trading volume charts more days than not.

But although the Pilbara share price is still up more than 168% over the past 12 months, the past few weeks haven't been too kind to the lithium giant. After today's meaty fall of 1.1% or so, the Pilbara share price has now lost 16.9% over the past month alone. 

So what's gone wrong in February for Pilbara? Well, let's start with the company's earnings. Pilbara reported its half-year earnings back on 23 February. 

As my Fool colleague James covered at the time, the company saw some impressive growth metrics. Shipments increased by 49%, while half-year sales revenue grew by an even heftier 394% to $291.7 million. That helped Pilbara bring in $151.1 million in earnings before interest, tax, depreciation and amortisation (EBITDA). That was up from $3.2 million a year earlier. 

Miner looks into the distance as he checks a folder.

Image source: Getty Images

Is the Pilbara Minerals share price a buy?

And yet investors didn't seem impressed. The Pilbara share price fell 7% at one point that day, and has fallen more than 8% since. Sometimes, even a fast-growing company can have too much good news baked in, one could argue. Even at today's prices Pilbara still boasts a price-to-earnings (P/E) ratio of 93.15. That's quite high compared to the broader market right now. 

So now that the Pilbara share price has had a haircut, could it be good value at these prices? Well, as we covered last week, Eley Griffiths Group analyst and portfolio manager Tim Serjeant now reckons Pilbara could be the best value lithium stock on the ASX. He described the company as having "the best exposure to current pricing dynamics".

Earlier this month, my Fool colleague Tony covered how Burman Invest chief investment officer Julia Lee was also buying Pilbara, based on the company's position as a 'hard-rock' lithium producer. 

So some professional investors are certainly finding this dip in the Pilbara share price appealing. 

At today's closing Pilbara Minerals share price of $2.71, the company is almost in the middle of its 52-week range of 88 cents and $3.89 a share. 

Motley Fool contributor Sebastian Bowen 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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