Why is the Core Lithium (CXO) share price dropping today?

Posted: 25 March 2022 12:20 pm
News
CXO-shares-25March_1800x1000_Finder

Shares in the lithium explorer are up 5-fold over the last 12 months.

Explorer Core Lithium (ASX: CXO) is among the most traded shares on the ASX boards on Friday, but among the list of worst performers. Shares in the company were down 3.4% to $1.19 at the time of writing. By comparison, rival Pilbara Minerals (ASX: PLS) was up nearly 3% at $3.20.

Why has the CXO stock price slipped?

The drop in the Core Lithium shares comes after the company on Friday announced the shock resignation of its founding managing director Stephen Biggins.

In a statement to the ASX, the company said Mr Biggins was resigning for personal reasons and will step down from the role by the end of the year.

"Core is in the perfect position to reach its next stage of growth as a lithium producer, and I feel it is the right time to step down as managing director and pass the torch on to the right person to lead Core in this next stage," Mr Biggins said in the statement.

"Our transformation from explorer to producer is progressing to plan, the financial performance is strong, and at the Finniss Lithium Project, we have built a platform for sustainable growth for many years to come."

The Core Board has appointed Korn Ferry to conduct a competitive executive search for a new CEO.

Transformation

The news comes just 3 weeks after Core Lithium signed a landmark deal with electric vehicle giant Tesla Inc. (NASDAQ: TSLA) for the supply of up to 110,000 dry metric tonnes of spodumene concentrate, the substance used to produce the lithium chemical used in electric vehicle batteries, over a 4 year period.

The deal marked the culmination of Core Lithium's transformation from another junior explorer to reliable supply partner for global firms.

The agreement came just months after CXO's board took a Final Investment Decision to start the development of the wholly-owned Finniss Project near Darwin in the Northern Territory, with first production scheduled for delivery by the end of 2022.

Finniss has been awarded Major Project Status by the federal government, and is considered one of the most capital-efficient projects that will provide high-grade lithium suitable for batteries used to power electric vehicles and renewable energy storage.

That transformation was led by Mr Biggins, who has been Core Lithium's MD for 12 years and will be hard to replace. That sentiment is shared both by the company's board, as well as the market.

"Stephen was a foundation director of Core and has put the company on a pathway for a stronger future. With the development of the Finniss Lithium Project, he has led the biggest transformation in the company's history and has set Core up for strong earnings growth," Chairman Greg English said.

Serious about investing? Here's your new unfair advantage

Ticker Nerd uses advanced software to track hundreds of signals and data points to find stocks before they blow up. Don't miss out!
Get started for free

Considering buying CXO shares?

If you are keen to buy Core Lithium shares, you should consider investing through an online share trading platform.

Keep in mind that not all platforms offer the same list of stocks. Some offer US stocks only, so make sure to select a platform that offers ASX-listed stocks.

Choose from the dozens available for Australian investors. Compare the features and fees from the plethora of trading platforms available.

Looking for a low-cost online broker to invest in the stock market? Compare share trading platforms to start investing in stocks and ETFs.

Disclaimer: This information should not be interpreted as an endorsement of futures, stocks, ETFs, CFDs, options or any specific provider, service or offering. It should not be relied upon as investment advice or construed as providing recommendations of any kind. Futures, stocks, ETFs and options trading involves substantial risk of loss and therefore are not appropriate for all investors. Trading CFDs and forex on leverage comes with a higher risk of losing money rapidly. Past performance is not an indication of future results. Consider your own circumstances, and obtain your own advice, before making any trades.

Get more from Finder

Ask an Expert

You are about to post a question on finder.com.au:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and Privacy & Cookies Policy.
Go to site