Home / Sector / Materials Shares / The Piedmont Lithium share price is actually gaining today. What's going on?

The Piedmont Lithium share price is actually gaining today. What's going on?

What could be helping Piedmont push away the red bug?

Posted by
Mitchell Lawler
Mitchell stumbled upon the concept of investing when in high school, devotedly urging his parents to put some money into a handful of technology companies with increasingly popular products among his demographic – many of which have gone on to great success. It wouldn’t be until 2017, some five years later, that Mitchell became an investor of his own money. Having studied and worked as a mechanical engineer in the building services industry, Mitchell takes a methodical and analytical approach to evaluating businesses. Rather than relying purely on numbers, Mitchell drills beyond a company’s metaphorical mantle to unearth obscure patterns or competitive advantages that would go otherwise unnoticed. His expertise resides within areas such as software, consumer goods, and building services equipment. However, his quest to find quality companies that set the industry standard and flex some degree of an impenetrable position has no limits – small cap to mega cap, cosmetics to healthcare – if it’s an exceptional business it’s on his radar.
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Key points
  • The Piedmont Lithium share price is firmly in the green during a deeply red day 
  • Shares in the lithium company are up 3.85% to 94.5 cents apiece 
  • The company could be seeing enthusiasm flow to it after lagging behind Pilbara Minerals recently 

The Piedmont Lithium Inc (ASX: PLL) share price is part of an exclusive club of positive returners today. Shareholders would be rejoicing at the sight of their holdings showing insulated characteristics from the rest of the beaten-down market.

In afternoon trade, shares in the lithium hopeful are touting a 3.9% gain to 94.5 cents. Although, anything other than negative returns is a breath of fresh air right now. Even the broad S&P/ASX 200 Index (ASX: XJO) is 2.46% worse off than yesterday.

So, why is the Piedmont Lithium share price holding up in the face of this adversity?

Two men in hard hats and high visibility jackets look together at a laptop screen at a mine site.

Image source: Getty Images

Playing catch-up

A number of ASX-listed lithium shares have been going gangbusters over the past month. The optimism for the battery material has been reverberating in the ears of investors recently. Consequently, shares in many lithium companies have flown higher despite a still shaky environment.

One example of the positive projections was reported by fellow Motley Fool writer, Tristan Harrison. The article detailed how Barrenjoey — a major broker — is forecasting a potential rise of 86% in the lithium price over the next two years.

Furthermore, Pilbara Minerals has experienced a tremendous surge following its incredible full-year result. Since releasing its FY22 numbers, the Pilbara Minerals share price has exploded by 42%. Whereas, the Piedmont Lithium share price has been more subdued.

TradingView Chart

As shown above, shares in Piedmont Lithium have started to reignite. However, there is still a clear delineation between the performance of Pilbara Minerals and Piedmont.

Though, it is worth mentioning, that Piedmont is yet to draw revenue from its operations. Nevertheless, investors seem to be content with ignoring the market turbulence today to bid the Piedmont Lithium share price higher.

Piedmont Lithium share price in 2022

While unprofitable ASX tech shares have been ravaged by rising inflation and interest rates, some loss-making lithium companies appear to have dodged the damage.

So far this year, the Piedmont Lithium share price has returned an impressive 22%. Considering the benchmark index is down nearly 10%, Piedmont's performance is commendable by any stretch of the imagination.

The company currently holds a market capitalisation of $1.66 billion.

Motley Fool contributor Mitchell Lawler 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 Scott Phillips.

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