Albemarle Stock: Buy the Dip for Big Gains


Some investors gravitate towards controversial market plays, attracted by the significant upside potential. Albemarle Co. NYSE: ALB deserves attention today, especially after its 34% drop since May 2024. Despite recent discouraging price action, the fundamentals of this company may signal a potential rally ahead.

Albemarle Co. stock logo
$98.90

+2.00 (+2.06%)

(As of 11:02 AM ET)

52-Week Range
$90.32

$246.71

Dividend Yield
1.62%

P/E Ratio
35.96

Price Target
$150.16

The market’s focus has largely been on the tech sector, particularly stocks like NVIDIA Co. NASDAQ: NVDA in artificial intelligence and Tesla Inc. NASDAQ: TSLA in electric vehicles, despite its recent questionable rally. Investors should also pay close attention to major stock rallies in other sectors.

Albemarle stands out, as it specializes in lithium mining and processing—key for batteries powering the electric vehicle revolution.

How EV Growth is Powering Albemarle’s Stock Potential

There’s no question that electric vehicles are becoming more widely adopted in the global economy today. From North America to Europe, to even all around Asia, it is companies like Tesla Inc. NASDAQ: TSLA or China’s own BYD OTCMKTS: BYDDY that are driving most of the growth in deliveries, which broke the million mark on 2023, and not something they are likely looking to give up.

Recently, to keep competition at bay and protect the U.S. lead in electric vehicle development, the current administration slapped tariffs on Chinese EVs of up to 100%, keeping domestic demand focused on companies like Tesla. Now, with the government aiming to control the supply chain for these vehicles and support key players, it’s no surprise that Albemarle topped the list.

Recently, the U.S. Department of Energy (DOE) granted Albemarle up to $150 million in capital to build an American-based lithium facility. This will support domestic lithium production and keep the electric vehicle supply chain onshore.

However, Albemarle is not only dependent on electric vehicle waves to make its growth prospects shine; some of the company’s biggest clients are also exposed to the growing demand and breakthroughs in artificial intelligence. To name a few, Samsung Electronics Co. OTCMKTS: SSNLF is exposed to the chips and semiconductors market, along with Panasonic Holdings Co. OTCMKTS: PCRFY.

Albemarle is benefiting from several bullish trends, and investors recognize that these industries are still in their early stages. The question is now centered on how much upside there could be in the stock moving forward, and that’s where Wall Street analyst forecasts come into play.

Albemarle’s Stock Forecast: Wall Street Predicts Major Upside

Today, Wall Street analysts forecast up to 171% growth in earnings per share (EPS) for the next 12 months. Leaning on these predictions, analysts at Oppenheimer felt comfortable enough to slap a valuation of $178 a share for Albemarle stock, daring it to rally by as much as 83.7% from where it sits today.

Overall MarketRank™
4.87 out of 5

Analyst Rating
Hold

Upside/Downside
50.4% Upside

Short Interest
Bearish

Dividend Strength
Strong

Sustainability
-6.52

News Sentiment
-0.07mentions of Albemarle in the last 14 days

Insider Trading
Selling Shares

Projected Earnings Growth
171.01%

See Full Details

Considering that these price targets were set in July 2024, they become more critical for investors now that the stock has declined for over a month. Analysts rarely stick their necks out to boost a stock experiencing bearish price action, so these analysts see that much upside today means twice as much for investors.

Knowing that several tailwinds are pushing Albemarle’s momentum and analysts are starting to wake up to these facts, the Vanguard Group decided to boost its stakes in Albemarle stock by 0.2% as of May 2024. While that percentage term may not sound like much, it would translate into a net investment of $1.9 billion today.

Putting Albemarle stock into a discount perspective, investors can start with price action. The stock now trades at only 39% of its 52-week high, which drove all the other valuation metrics into a steep discount compared to the rest of the basic materials sector.

Against the industry’s average price-to-earnings (P/E) ratio of 99.2x, Albemarle’s valuation of 32.9x will offer investors a discount of 66.8%. However, investors can also lean on other metrics, such as the price-to-book ratio. Albemarle’s 1.1x valuation also provides a discount of 69.4% compared to the industry’s 3.6x P/B multiple today.

Before you consider Panasonic, you’ll want to hear this.

MarketBeat keeps track of Wall Street’s top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on… and Panasonic wasn’t on the list.

While Panasonic currently has a “Moderate Buy” rating among analysts, top-rated analysts believe these five stocks are better buys.

View The Five Stocks Here

5G Stocks: The Path Forward is Profitable Cover

Click the link below and we’ll send you MarketBeat’s guide to investing in 5G and which 5G stocks show the most promise.

Get This Free Report

Like this article? Share it with a colleague.

Link copied to clipboard.





Source link

Content Disclaimer and Copyright Notice
Content Disclaimer

The content provided on this website is sourced from various RSS feeds and other publicly available sources. We strive to ensure the accuracy and reliability of the information, and we always provide source links to the original content. However, we are not responsible for the content’s accuracy or any changes made to the original sources after the information is aggregated on our site.

Fair Use and Copyright Notice

This website may contain copyrighted material, the use of which has not always been specifically authorized by the copyright owner. We believe this constitutes a “fair use” of any such copyrighted material as provided for in section 107 of the US Copyright Law.

In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. If you wish to use copyrighted material from this site for purposes of your own that go beyond fair use, you must obtain permission from the copyright owner.

Leave a Reply

Your email address will not be published. Required fields are marked *