The June quarter production result was positive, Credit Suisse observes. The project has demonstrated design recovery of 70-75% for extended periods. The main issue is with demand which is outside the company’s control.
The broker expects the lithium price to deteriorate further. Refinancing is considered a significant positive and will materially reduce risk of a liquidity event.
Outperform rating maintained. Target is $0.40.
Target price is $0.40.Current Price is $0.37. Difference: $0.03 – (brackets indicate current price is over target). If PLS meets the Credit Suisse target it will return approximately 8% (excluding dividends, fees and charges – negative figures indicate an expected loss).