I think @Goldfish makes some good points @Jarrahman, particularly in regards to investing in resource companies. Because of that, I've found my most success has been to only play at the big end of town (PLS, BHP, etc) or at the entry level (VTM, HZR, etc).
Specifically, with respect to PLS, I had been sitting on a reasonable quantity IRL (unfortunately I jump out of my SM holding too early) since buying for sub-$1 in March 2021. So I've had a real front row seat to a lot of price volatility since then, with some great highs in 2022 and some horror lows just above my original buy price in 2025. I persevered as I have always been a huge fan of management and the fact PLS is one of the better global lithium spodumene producers.
Now, for the real news, I actually jumped out at a bit over $6/share last week, as that finally tested my limit I had placed some time ago (and my nerves). Of course, that now means PLS is now bound to go forever upwards, at least until I buy again!!
So what is the future of Lithium and PLS. Maybe let me start with PLS. As I said earlier in this post, I've always rated PLS and their management team, so if i was to be involved in lithium, it definitely would be PLS for me. As for the near term future of lithium, who the hell knows!! Personally, I have no real conviction or real idea, particularly with the current global turmoil. That said, unless there is a radical change in mass produced storage tech, which can obviously happen and there are a lot of businesses globally claiming they have this answer (without any definitive proof to date), then lithium most likely will still be relevant for some time to come. Also, lithium spot prices will depend on how nicely China plays, remembering how they simply crushed the global price when it suited them back in 2025.
Here's my AI PA's view for what it's worth when asked the summarised views of one of the biggest lithium forecasters UBS, and a few of their competitors.
LITHIUM FORECAST (take with a grain of salt)
UBS is currently the most bullish major broker on global lithium, having declared the start of a "third lithium supercycle" as of early 2026. While other researchers are turning more positive, there is a distinct gap between the "UBS super-bull" case and the more cautious "balanced market" view held by others.
1. The UBS View: The "Third Supercycle"
UBS has overhauled its forecasts, citing a "Triple Parity" inflection point where EVs are now cheaper to own and run than petrol cars globally.
• Price Upgrades: UBS raised its 2026 spodumene forecast by 74% to US$3,131/t.
• The Logic: They predict a supply deficit of 18,000 tonnes in 2026, driven by a doubling of demand for Energy Storage Systems (ESS) and continued EV growth.
• The "Fly-up": They believe prices could potentially double again from current levels before a major supply response arrives in 2027/28.
2. Do Other Researchers Agree?
There is directional agreement that the "glut" is over, but disagreement on the magnitude of the price spike.
Researcher Viewpoint 2026 Market Stance
Morgan Stanley Aggressive Forecasts a massive 80,000t deficit; recently cut supply estimates by 20%.
Macquarie Constructive Expects a balanced market but warns supply disruptions in China could tip it into a deficit.
BofA / Citi Cautious Bull Seeing inventory stabilization and "far beating" earnings from miners, leading to target price raises.
Goldman Sachs Conservative Traditionally more bearish; focuses on the risk of "marginal supply" (lepidolite) returning if prices rise too fast.
3. What This Means for Pilbara Minerals (PLS)
PLS is currently in a unique position as one of the few pure-play, large-cap producers with zero debt and massive cash reserves.
Valuation Tension: UBS itself remains a bit of a “contrarian” on the stock price. Despite their bullish lithium price call, they currently hold a Neutral/Hold rating on PLS with a target around $5.20. This suggests they believe the “supercycle” is already partially baked into the recent share price rally.
Operating Leverage: Because PLS is a low-cost producer, every US100 increase in the spodumene price flows almost directly to the bottom line. If the UBS US3,131/t forecast hits, PLS margins would expand significantly beyond current consensus.
The “ASX 50” Factor: PLS’s recent inclusion in the ASX 50 index has forced institutional buying, which provides a floor for the price but also makes it more sensitive to global macro sentiment.
Dividend Potential: With the market shifting to a deficit, analysts are looking for a reinstatement of dividends in late 2026, which would likely act as the next major catalyst for the stock.
The Bottom Line: If you’re following the UBS thesis, PLS is the “cleanest” way to play the cycle on the ASX, but the broader market is still waiting for confirmation that the supply deficit is as deep as UBS and Morgan Stanley claim.
Conclusion
So, read into that summary as you will!! I was happy to take the $6ish price/share last week, but that was after 5 years of blood, sweat and tears......but I wouldn't have it any other way as a long-term value investor (mostly).
Happy investing!!