Which ASX lithium share is the 'highest quality lithium miner on the ASX'?

Blackwattle portfolio managers, Tim Riordan and Michael Teran, reckon Pilbara Minerals Ltd (ASX: PLS) is the lithium star of the ASX.

In their latest bulletin, Riordan and Teran said the market's largest pure-play lithium share has "material upside" ahead.

Let's hear more from them.

ASX lithium shares on a roll lately

ASX lithium shares have been outperforming due to rising commodity prices.

Several ASX lithium shares have set new 52-week highs, including Pilbara Minerals, which soared to $4.26 per share this week.

Riordan and Teran said Pilbara Minerals was among the best performers within their Mid-Cap Quality Fund last month.

The Pilbara Minerals share price ripped 31% in October alone.

The managers said:

PLS rallied 31% in October, as PLS delivered an exceptional quarterly production and lithium prices rallied ~18% in October, as the supply / demand dynamic becomes more balanced.

PLS is the 100% owner-operator of relatively low-cost, long-life spodumene mines. PLS also has a strong net cash balance sheet, which provides flexibility and a competitive advantage to indebted peers.

Lithium commodity prices have lifted significantly over the past month.

The Spodumene Concentrate Index (CIF China) Price rose 2.85% overnight to US$1,117 per tonne — up by more than 30% in a month.

While lithium prices have been in a multi-year bear market, prices appear to have bottomed out in recent months; supply is now
constrained by uneconomical prices but at the same time demand continues to grow healthily.

Lithium prices will continue to be volatile but if demand remains strong, we expect further recovery in lithium prices over 2026.

We continue to see material upside for PLS as an 'improving quality' business and view PLS as the highest quality, lithium miner on the ASX.

The managers said the company's September quarter production report was outstanding.

What did Pilbara Minerals report?

Pilbara Minerals reported a 2% increase in spodumene production and a 20% increase in realised pricing.

This led to a 30% spike in revenue to $251 million.

The lithium miner also reduced its unit operating cost by 13%, enhancing cash margins.

Riordan and Teran said:

PLS is finally seeing the benefits from the P1000 expansion, and cements PLS's position as the best-in-class lithium spodumene operator.

PLS is extremely well placed to benefit from any further recovery in lithium prices, with strong operations and significant production growth optionality, allowing for continued shareholder value creation through the cycle.

ASX lithium shares are benefiting from rising lithium prices, driven by strong demand for the metal to power batteries and support new infrastructure, as well as new government support for the electric vehicle industry in China.

Pilbara Minerals share price snapshot

The Pilbara Minerals share price is up 91.32% in the year to date compared to a 4.82% lift for the S&P/ASX 200 Index (ASX: XJO).

The ASX lithium share closed trading at $4.19 on Thursday, up 5.28%.