Investors in Wildcat Resources Ltd (ASX: WC8) shares are cheering Friday after the price for the small-cap mining stock hit a 52-week high.
At the time of writing mid-afternoon, the shares were trading for 80 cents, after going for as much as 89 cents earlier in the day.
Believe it or not, as recently as May — that's just five months ago — Wildcat Resources shares were selling for just 3 cents.
That means $10,000 invested then would now be worth $266,666.
So what's happening here?
Image source: Getty Images
'Major lithium discovery'
First is that the junior miner put out a quarterly business update on Friday morning.
The big headline out of that was that Wildcat Resources has confirmed a "major lithium discovery" at its Tabba Tabba project in the Western Australian region of Pilbara.
The discovery was first flagged last month, but this week Wildcat revealed the positive results of its testing.
Even though the site had been owned by other mining companies in the past, it's apparently the first time any operator had tested for lithium.
Lithium is a mineral sought after for batteries, especially for high-power products like electric cars.
The sharks are circling
Another possible reason for the share price rocketing could be rumours that Mineral Resources Ltd (ASX: MIN) managing director Chris Ellison has bought shares in Wildcat Resources.
The Australian Financial Review revealed on Monday that the billionaire had contacted some Wildcat investors about grabbing a stake off-market.
The lithium sector could be going through a consolidation phase while prices for the commodity and shares are in a dip.
Australia's wealthiest person Gina Rineheart recently took a stake big enough in Liontown Resources Ltd (ASX: LTR) to scare off US suitor Albemarle Corporation (NYSE: ALB).
