Pilbara Minerals Ltd (ASX: PLS) shares closed up 0.63% at $4.80 apiece in Thursday trade. The ASX 200 lithium share was essentially moving with the market, with the S&P/ASX 200 Index (ASX: XJO) finishing 0.13% higher at close of trade.
But that ain't how it's been trading lately. Pilbara Minerals shares have delivered outstanding growth both in 2023 so far and over 2022 as well.
The Pilbara Minerals share price was among the best performers of the ASX 200 in January, surging 27%.
In 2022, Pilbara Minerals shares rose by 17.2% between the close on 31 December 2021 and 30 December 2022. But on 25 October, it hit a record high of $5.66. At that point, the stock was up 77% for the year.
But can Pilbara Minerals deliver long-term wealth for investors?
What's the latest with Pilbara Minerals shares?
Like all ASX 200 lithium stocks, Pilbara Minerals shares have benefitted from sky-high lithium prices in recent years. Right now, there is optimism that lithium prices will stay higher for longer.
But it's not just that pushing Pilbara Mineral shares northwards.
There's also been exciting company news over the past year. That news has included a maiden profit in FY22 and a maiden dividend to be paid for FY23. Last month, Pilbara's quarterly update for December revealed a cash balance of $2.226 billion, up 62% on the September quarter.
Can Pilbara deliver long-term wealth?
Pilbara is among the world's top 10 global lithium producers. It is one of very few ASX lithium shares that is actually producing lithium. Many others are explorers in the early stages of building mines.
So, looking long term, Pilbara is well placed in that sense because it's establishing customer relationships now, well in advance of other ASX lithium companies that don't yet have anything to sell.
Another long-term positive for Pilbara Minerals shares is the direct link to two major emerging investment trends — decarbonisation and electric vehicles (EVs).
As reported in The Australian, Wealthi economist Peter Esho estimates there are six or seven million EVs globally today. That's expected to rise to at least 150 million by 2030. In short, that means a tonne (or rather billions of tonnes) of demand for lithium.
The other factor you need to consider when looking at any ASX share for long-term investment is company management. This requires research. Review the last few annual reports. Look into the backgrounds of the board and senior managers. Read what the brokers have to say about management, as they're out there spending time with senior company managers who want their investment funds.
You need to feel confident that the people running the business you are invested in are doing it well.
