Albemarle Corporation (ALB) Buy or Sell Stock Guide

Last updated: Sep 23, '17

The analysis below may be helpful to you if you have any of the following questions about ALB stock:

  • Is ALB a buy or a sell?
  • Should I sell or hold ALB stock today?
  • Is ALB a good buy / a good investment?
  • What are ALB analyst opinions, recommendations, ratings?

Here are ALB stock buy reasons/signals:

1. Albemarle has top-tier lithium assets through its brine operations in Chile, which are among the lowest-cost globally.

2. The company has tremendous upside to electric vehicle growth through lithium batteries. Its Talison joint venture is one of the few large operations that can significantly ramp up production over the next few years to meet incremental demand.

3. Albemarle also has low-cost bromine production through its highly concentrated brines in the Dead Sea and Arkansas.

4. ALB quarterly revenue growth was 10.10%, higher than the industry and sector average revenue growth (8.76% and 7.92%, respectively).

5. ALB profitability is improving. The YoY profit margin change was 12.19pp.

6. ALB forward dividend yield is 1.08%, higher than the industry (0.55%) and sector (1.06%) forward dividend yields.

7. ALB PEG ratio (P/E adjusted for growth) is 1.80, and it’s low compared to its industry peers’ PEG ratios.

8. ALB average analyst rating is Buy.

Here are ALB stock sell reasons/signals:

1. Albemarle's core bromine business has suffered from weaker demand for flame retardants, its primary end market, as consumers shift from televisions, desktops, and laptops to less-bromine-intensive tablets and mobile phones.

2. Weakness in oil markets negatively affects demand for bromine, which is used in completion fluids.

3. The decline in oil prices has led some oil refiners to hold off on replacing their hydroprocessing catalysts, which need to be placed once every one to three years.

4. ALB stock price ($134.44) is close to the 52-week high ($136.09). Perhaps now is a good time to sell?

5. ALB forward P/E ratio is 23.56, and it’s high compared to its industry peers’ P/E ratios.

6. ALB Price/Sales ratio is 4.65, and it’s high compared to its industry peers’ P/S ratios.

7. ALB average analyst price target ($125.59) is below its current price ($134.44).

8. ALB short share of float is 4.00%. The stock is much more frequently shorted than the average industry, sector or S&P 500 stock.

What are your thoughts on ALB?

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