Worst month of the year? The Pilbara Minerals share price has already hit 2 all-time highs in September

The Pilbara Minerals Ltd (ASX: PLS) share price has been an outperformer in recent weeks having secured a more-than-tidy gain since the June bounce in equity markets.

Over the past month of trade, Pilbara shares have clipped a 38% gain. In doing so, they have thrust past two previous all-time highs. At the time of writing, the Pilbara share price is climbing at $3.98.

The surge in the Pilbara share price means it has outpaced all benchmarks. In particular, the S&P/ASX 300 Metals and Mining Index (ASX: XMM), which is down 1.5% this past month, and 10.4% this year to date.

Compare the Pilbara share price with the metals and mining index on the chart below for this year to date.

What’s up with the Pilbara share price?

Chief to the upside in recent months are the results from Pilbara’s recent auctions held on its Battery Material Exchange (BMX).

This was supported by the company’s FY22 results. Herein, it exhibited the strength of the BMX and current lithium pricing in its business model.

In fact, Pilbara’s record-setting 577% jump in revenue to $1.2 billion and $561 million in reported after-tax profit for FY22 were enough to signal a frenzy of buying activity in the ASX lithium basket. The Pilbara share price led the charge, gaining 22% since the results release on 23 August.

Such a strong result demonstrates the probability that lithium supply and demand forces will keep the price of the battery metal buoyant for some time to come.

Analysts at JP Morgan recently echoed this sentiment. They revised their forecasts for lithium carbonate and spodumene upwards by 20% and 25% respectively in a research note.

The broker has identified numerous gaps within the supply chain from mine-to-metal for lithium. Not to mention the end-product of batteries and electric mobility.

This mismatch in supply and demand is likely to create a less benign pricing environment for lithium and its derivatives. JP Morgan says this will keep prices top-heavy for the foreseeable future.

Analysts at the firm backed this up by assigning a buy rating on Pilbara shares with a $4.10 objective price.

Notably, the update from JP Morgan is in stark contrast to rival investment bank Goldman Sachs’ apocalyptic forecast for the lithium market earlier in the year. This resulted in widespread selling activity across the ASX lithium contingent.

Meanwhile, the Pilbara share price remains up 85% for the past 12 months of trade.