Wildcat Resources shareholders see returns of 2800 per cent in 2023

Investors doubled their money in 2023 and in some cases saw returns 30 times bigger than in 2022 as stocks benefited from greener pastures ahead.

Stock trader Peter Tuchman reacts on the floor of the New York Stock Exchange at the closing bell. Picture: AFP

Investors doubled their money in more than 50 shares listed on the Australian Securities Exchange over the past 12 months, benefiting from resilience in parts of an economy subjected to a barrage of interest rate hikes.

While only seven companies on the ASX 200 and All Ordinaries racked up gains of more than 100 per cent, it was a different story among small cap stocks.

The best stock by a big margin was Wildcat Resources, which started last year at just 2.4c and finished just shy of 70c, a 2796 per cent increase, giving the junior miner a market cap of $830m.

The WA lithium explorer surged over $1 in November when billionaire Chris Ellison’s Mineral Resources obtained a 19.8 per cent stake in group amid a $100m raising for funds to advance the Tabba Tabba project in Western Australia.

Analysis from IRESS showed it was a similar story for fellow lithium player and All Ordinaries member Azure Minerals, which surged nearly 1600 per cent to $3.70 over the course of 2023 after starting out at 22c and setting a record high of $4.37 in November.

Investors jumped into the Perth-based group after high-grade lithium intersections found at its West Pilbara lithium project and turbocharged following a takeover offer from Sociedad Química y Minera de Chile S.A which it accepted late last month.

Gains by lithium miners come despite bearish sentiment for the sector in the past year on concerns global demand for electric vehicles might not be as strong as previously expected.

It comes after the ASX 200 experience its best month since 2020 as the benchmark index rose 7.8 per cent in December.

Mineral Resources managing director Chris Ellison snagged a stake in Wildcat Resources.

Capital.com senior market analyst Kyle Rodda told The Australian it overall wasn’t a great year for the small ordinaries index, but talks of interest rate cuts helped to drive gains in the later stages of 2023.

“We were looking at a pretty negative year in Australia until right at the end of 2023,” he said.

“The shift was the result that interest rates have pretty much peaked and now we are talking about rate cuts. This was a clear indication of a turning tide and spurred on pretty much all stocks and boosted valuations.”

Blue chip stock James Hardie Industries hit a record high of $57.56 in late 2023 — capping off a stellar year for the buildings material group which surged 114 per cent on resilience in the housing market at a time when many expected it to buckle from the weight of interest rate rises.

“Everything in the market works on expectations and James Hardie was a beneficiary of that dynamic. That surprising resilience despite higher rates really drove gains in 2023, but it remains to be seen whether it can sustain that in the new year,” Mr Rodda said.

The company’s biggest sales boost is coming from the renovation market, particularly in the US where the housing stock is rapidly ageing.

Neuren Pharmaceuticals shares surged more than 200 per cent according to IRESS, in a year which saw the biotech group record a market cap above $3bn after it revealed positive phase-two clinical trial results for its drug to treat Phelan-McDermid syndrome in children.

Bell Potter head of institutional sales Richard Coppleson said Neuren Pharmaceuticals and Emerald Resources have seen big jumps for several years now.

“Neuren Pharmaceuticals was up by 214 per cent in the past year, but before it experienced a 111 per cent in jump in 2021 and 193 per cent in 2021, while Emerald Resources has been up for five years in a row,” he said.

“James Hardie on the other hand experienced a strong rebound from a big fall in 2022.”

But Mr Rodda said while some stocks experienced strong gains, it was not always a sign returns would continue to be strong in the year ahead.

“Any stock that has gained more than 100 per cent is volatile, and if it goes up by that much in such a short period of time then it could easily fall by that much on the downside,” he said.

Volpara Health went from 55c at the start of 2023 $1.10 at year’s end following a strong year for the breast cancer detection software group, capped off by a takeover offer from Lunit.

The $300m bid to acquire the company saw shares jump by more than 40 per cent on December 14.

Gold copper exploration company WA1 Resources rocketed by 790 per cent on the promising outlook for its Arunta West project following evidence of a high-grade mineralised zone, while sea pearl producer Atlas Pearls lifted 693 per cent as it had sold 130,000 loose pearls for total revenue of $14.81 million in Kobe. The Kobe auction was the last sales event for 2023.