Pilbara Minerals Limited (ASX: PLS)
PLS is a metal producer with its Pilgangoora Lithium-Tantalite Project located in the Pilbara region of Western Australia. It holds a market capitalization of $7.65 billion as of March 16, 2022.
Financial and Operational Updates: On February 23, 2022, PLS announced that its Managing Director and CEO, Ken Brinsden decided to step down from the role by 2022-end. PLS commenced an executive search process for its next CEO. At its Pilgangoora project, the company is targeting the production of spodumene concentrates and primary tantalite concentrate. It is intended to achieve the combined production capacity of 560-580k tpa spodumene concentrate from September 2022 quarter. For H1FY22, spodumene concentrate production reached 169,23dmt. It had realized revenue of $291.7 million. It had clocked a net profit of $114 million in H1FY22 as compared to a net loss of $21.2 million in the prior year.
Technical Analysis: On the daily chart, PLS stock price broke the rising trendline support and prices are sustaining below the rising trend line support zone. Further, the leading indicator RSI (14-period) is trading at ~38.287 level, indicating negative momentum. The prices are trading below the trend-following indicator 21-period, which may act as a resistance zone. An important support level for the stock is placed at AUD 2.28 while the key resistance level is placed at AUD 2.95.
After considering the uncertainties on stepping down of CEO, volatile lithium prices amid the escalating geopolitical tension on Ukraine and Russia war, and current trading levels, a ‘Watch’ stance is suggested. The stock was analyzed as per the closing price of AUD 2.600 per share, as of 15th March 2022, up ~1.167%.
Investors can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario.
PLS Daily Technical Chart, Data Source: REFINITIV
Dusk Group Limited (ASX: DSK)
DSK operates as a retailer of home fragrance products in Australia. Its products include scented pillars, votive candles, diffusers, air purifiers, essential oils, reed diffusers, mood reed refills, and several others. DSK holds a market capitalization of $155.66 million as of March 16, 2022.
Recent Financial and Operational Highlights: As announced on March 3, 2022, DSK will not be able to proceed with the acquisition of Eroma as it was unable to satisfy certain conditions attached to the transaction. In the H1FY22, DSK reported a 12% drop in revenues over the prior year to reach $80.0 million. Its pro forma EBIT tumbled from $28 million in H1FY21 to $21.3 million in H1FY22. This was on account of store closures and a surge in occupancy costs. It had closed the period with a cash balance of $33.3 million as of December 2021, down from $34.9 million achieved last year similar period.
Technical Analysis: On the daily chart, DSK prices are trading below the downward sloping trend line resistance level and facing the resistance of the trendline. Moreover, the momentum oscillator RSI (14-period) trading at ~43.275 level, indicating a lack of momentum in the prices. Further, the prices are trading below the trend-following indicator 21-period SMA, which may act as a resistance level. An important support level for the stock, is placed at AUD 2.25 while the key resistance level is placed at AUD 2.66.
After considering the termination of the Eroma acquisition, dismal H1FY22 performance, and current trading levels, a ‘Watch’ stance is suggested. The stock was analyzed as per the closing price of AUD 2.460 per share, as of 16th March 2022, down ~1.601%
Investors can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario.
DSK Daily Technical Chart, Data Source: REFINITIV
Note 1: The reference data in this report has been partly sourced from REFINITIV
Note 2: Investment decisions should be made depending on the investors' appetite for upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the analysis has been achieved and is subject to the factors discussed above alongside support levels provided.
Technical Indicators Defined: -
Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.
Resistance: A level where-in the stock prices tend to find resistance when they are rising, and the uptrend may take a pause due to profit booking or selling interest.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
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