Pilbara Minerals' spodumene concentrate production came in at 220kt for Q1, beating forecasts by Morgan Stanley and consensus by 18% and 10%, respectively. Overall, the broker assesses a good quarter given market conditions.

The broker notes these results benefited from higher lithium grades, which will eventually fall.

For the near-term, the Ngangaju closure due to market conditions is accretive to valuation by reducing capital requirements, improving recoveries, and reducing mining complexity, explain the analysts.

The target for Pilbara Minerals rises to $3.00 from $2.95. Equal-weight. Industry View: Attractive.

Sector: Materials.

Target price is $3.00.Current Price is $2.81. Difference: $0.19 - (brackets indicate current price is over target). If PLS meets the Morgan Stanley target it will return approximately 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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