Albemarle (ALB) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research
·3-min read

Albemarle (ALB) closed the most recent trading day at $176.92, moving +1.85% from the previous trading session. The stock outpaced the S&P 500's daily gain of 0.36%. Elsewhere, the Dow lost 0.12%, while the tech-heavy Nasdaq added 0.69%.

Coming into today, shares of the specialty chemicals company had gained 16.09% in the past month. In that same time, the Basic Materials sector gained 11.13%, while the S&P 500 gained 4.27%.

Investors will be hoping for strength from ALB as it approaches its next earnings release, which is expected to be February 17, 2021. The company is expected to report EPS of $1.09, down 36.99% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $839.20 million, down 15.45% from the year-ago period.

It is also important to note the recent changes to analyst estimates for ALB. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.28% lower. ALB is holding a Zacks Rank of #3 (Hold) right now.

Digging into valuation, ALB currently has a Forward P/E ratio of 43.5. For comparison, its industry has an average Forward P/E of 18.45, which means ALB is trading at a premium to the group.

Meanwhile, ALB's PEG ratio is currently 3.67. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. ALB's industry had an average PEG ratio of 3.63 as of yesterday's close.

The Chemical - Diversified industry is part of the Basic Materials sector. This group has a Zacks Industry Rank of 46, putting it in the top 19% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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