NYSE:ALB

Stock Analysis Report

Executive Summary

Albemarle Corporation develops, manufactures, and markets engineered specialty chemicals worldwide.

Rewards

Trading at 66.6% below its fair value

Earnings grew by 65.6% over the past year

Pays a high and reliable dividend of 2.25%

Risk Analysis

Has a high level of debt



Snowflake Analysis

Undervalued with solid track record and pays a dividend.


Similar Companies

Share Price & News

How has Albemarle's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ALB has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

2.6%

ALB

0.7%

US Chemicals

1.1%

US Market


1 Year Return

-26.7%

ALB

-0.09%

US Chemicals

17.8%

US Market

Return vs Industry: ALB underperformed the US Chemicals industry which returned -0.1% over the past year.

Return vs Market: ALB underperformed the US Market which returned 17.8% over the past year.


Shareholder returns

ALBIndustryMarket
7 Day2.6%0.7%1.1%
30 Day-3.9%-3.3%1.4%
90 Day-5.7%1.6%3.9%
1 Year-25.3%-26.7%15.3%-0.09%20.3%17.8%
3 Year-25.4%-28.3%32.6%7.7%44.8%35.4%
5 Year28.5%18.8%50.1%17.7%71.3%52.4%

Price Volatility Vs. Market

How volatile is Albemarle's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Albemarle undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ALB ($65.3) is trading below our estimate of fair value ($195.7)

Significantly Below Fair Value: ALB is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: ALB is good value based on its PE Ratio (12.1x) compared to the Chemicals industry average (20.3x).

PE vs Market: ALB is good value based on its PE Ratio (12.1x) compared to the US market (18.4x).


Price to Earnings Growth Ratio

PEG Ratio: ALB is poor value based on its PEG Ratio (12.9x)


Price to Book Ratio

PB vs Industry: ALB is good value based on its PB Ratio (1.8x) compared to the US Chemicals industry average (2.2x).


Next Steps

Future Growth

How is Albemarle forecast to perform in the next 1 to 3 years based on estimates from 20 analysts?

0.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ALB's forecast earnings growth (0.9% per year) is below the savings rate (1.7%).

Earnings vs Market: ALB's earnings (0.9% per year) are forecast to grow slower than the US market (14.2% per year).

High Growth Earnings: ALB's earnings are forecast to grow, but not significantly.

Revenue vs Market: ALB's revenue (3.9% per year) is forecast to grow slower than the US market (7.4% per year).

High Growth Revenue: ALB's revenue (3.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ALB's Return on Equity is forecast to be low in 3 years time (13%).


Next Steps

Past Performance

How has Albemarle performed over the past 5 years?

15.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ALB has high quality earnings.

Growing Profit Margin: ALB's current net profit margins (16.3%) are higher than last year (10.4%).


Past Earnings Growth Analysis

Earnings Trend: ALB's earnings have grown by 15.9% per year over the past 5 years.

Accelerating Growth: ALB's earnings growth over the past year (65.6%) exceeds its 5-year average (15.9% per year).

Earnings vs Industry: ALB earnings growth over the past year (65.6%) exceeded the Chemicals industry -17%.


Return on Equity

High ROE: ALB's Return on Equity (16.1%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Albemarle's financial position?


Financial Position Analysis

Short Term Liabilities: ALB's short term assets ($2.0B) exceed its short term liabilities ($1.4B).

Long Term Liabilities: ALB's short term assets ($2.0B) do not cover its long term liabilities ($2.7B).


Debt to Equity History and Analysis

Debt Level: ALB's debt to equity ratio (47.9%) is considered high.

Reducing Debt: ALB's debt to equity ratio has reduced from 68.8% to 47.9% over the past 5 years.

Debt Coverage: ALB's debt is well covered by operating cash flow (26.8%).

Interest Coverage: ALB's interest payments on its debt are well covered by EBIT (15.6x coverage).


Balance Sheet

Inventory Level: ALB has a high level of physical assets or inventory.

Debt Coverage by Assets: ALB's debt is covered by short term assets (assets are 1x debt).


Next Steps

Dividend

What is Albemarle's current dividend yield, its reliability and sustainability?

2.25%

Current Dividend Yield


Dividend Yield vs Market

company2.3%marketbottom25%1.4%markettop25%3.7%industryaverage2.2%forecastin3Years2.2%

Current dividend yield vs market & industry

Notable Dividend: ALB's dividend (2.25%) is higher than the bottom 25% of dividend payers in the US market (1.44%).

High Dividend: ALB's dividend (2.25%) is low compared to the top 25% of dividend payers in the US market (3.67%).


Stability and Growth of Payments

Stable Dividend: ALB's dividends per share have been stable in the past 10 years.

Growing Dividend: ALB's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (26.6%), ALB's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ALB's dividends in 3 years are forecast to be well covered by earnings (24.1% payout ratio).


Next Steps

Management

What is the CEO of Albemarle's salary, the management and board of directors tenure and is there insider trading?

3.3yrs

Average management tenure


CEO

Luke Kissam (54yo)

8.3yrs

Tenure

US$6,666,394

Compensation

Mr. Luther C. Kissam IV, also known as Luke, has been the Chief Executive Officer of Albemarle Corporation September 1, 2011 and its President since March 7, 2013 also its Chairman since November 7, 2016. ...


CEO Compensation Analysis

Compensation vs Market: Luke's total compensation ($USD6.67M) is about average for companies of similar size in the US market ($USD6.70M).

Compensation vs Earnings: Luke's compensation has been consistent with company performance over the past year.


Management Age and Tenure

3.3yrs

Average Tenure

53yo

Average Age

Experienced Management: ALB's management team is considered experienced (3.3 years average tenure).


Board Age and Tenure

4.9yrs

Average Tenure

61.5yo

Average Age

Experienced Board: ALB's board of directors are considered experienced (4.9 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$199,79020 Aug 19
Eric Norris
EntityIndividual
Shares3,090
Max PriceUS$64.66
BuyUS$70,85015 May 19
DeeAnne Marlow
EntityIndividual
Role
Head of Human Resources
Chief Human Resources Officer
Shares1,000
Max PriceUS$70.85

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Karen Narwold (59yo)

    Executive VP

    • Tenure: 0yrs
    • Compensation: US$2.05m
  • Luke Kissam (54yo)

    Chairman

    • Tenure: 8.3yrs
    • Compensation: US$6.67m
  • Ahmad Khalifeh

    Managing Director of Middle East Office

    • Tenure: 12.6yrs
  • Scott Tozier (53yo)

    Executive VP & CFO

    • Tenure: 8.9yrs
    • Compensation: US$2.21m
  • Donald LaBauve (52yo)

    VP, Corporate Controller & CFO of Lithium Global Business Unit

    • Tenure: 6.8yrs
    • Compensation: US$667.74k
  • DeeAnne Marlow (53yo)

    Chief Human Resources Officer

    • Tenure: 0.8yrs
  • Dave Ryan Terrence

    Vice President of Corporate Strategy & Investor Relations

    • Tenure: 1.4yrs
  • Brian Tessin

    Chief Tax Counsel & VP of Tax

    • Tenure: 3.3yrs
  • Glen Merfeld

    Chief Technology Officer of Lithium Business

    • Tenure: 1.7yrs
  • John Barichivich (52yo)

    Principal Accounting Officer

    • Tenure: 0.08yrs

Board Members

  • Laurie Brlas (61yo)

    Independent Director

    • Tenure: 2.5yrs
    • Compensation: US$239.40k
  • Jim O’Brien (65yo)

    Independent Director

    • Tenure: 7.4yrs
    • Compensation: US$240.87k
  • Bill Hernandez (71yo)

    Independent Director

    • Tenure: 8.9yrs
    • Compensation: US$250.87k
  • Jerry Steiner (59yo)

    Independent Director

    • Tenure: 6.4yrs
    • Compensation: US$237.36k
  • Jerry Masters (58yo)

    Lead Independent Director

    • Tenure: 1.6yrs
    • Compensation: US$268.61k
  • Luke Kissam (54yo)

    Chairman

    • Tenure: 8.3yrs
    • Compensation: US$6.67m
  • Doug Maine (70yo)

    Independent Director

    • Tenure: 4.9yrs
    • Compensation: US$230.87k
  • Tee Taggart (71yo)

    Independent Director

    • Tenure: 12.8yrs
    • Compensation: US$230.87k
  • Diarmuid O'Connell (55yo)

    Independent Director

    • Tenure: 1.6yrs
    • Compensation: US$215.85k
  • Alejandro Wolff (62yo)

    Independent Director

    • Tenure: 4.9yrs
    • Compensation: US$240.60k

Company Information

Albemarle Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Albemarle Corporation
  • Ticker: ALB
  • Exchange: NYSE
  • Founded: 1993
  • Industry: Specialty Chemicals
  • Sector: Materials
  • Market Cap: US$6.862b
  • Shares outstanding: 106.03m
  • Website: https://www.albemarle.com

Number of Employees


Location

  • Albemarle Corporation
  • 4250 Congress Street
  • Suite 900
  • Charlotte
  • North Carolina
  • 28209
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ALBNYSE (New York Stock Exchange)YesCommon StockUSUSDFeb 1994
AMCDB (Deutsche Boerse AG)YesCommon StockDEEURFeb 1994
ALB *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNFeb 1994
0HC7LSE (London Stock Exchange)YesCommon StockGBUSDFeb 1994
ALBEWBAG (Wiener Boerse AG)YesCommon StockATEURFeb 1994

Biography

Albemarle Corporation develops, manufactures, and markets engineered specialty chemicals worldwide. Its Lithium segment offers lithium compounds, including lithium carbonate, lithium hydroxide, lithium chl ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/10 23:31
End of Day Share Price2019/12/10 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.