Recommendation: Buy
| Entry Date | Symbol | Recommendation | Entry Price (USD) | Target 1 (USD) | Target 2 (USD) | Holding Duration | Position Status | Return(%)* |
|---|---|---|---|---|---|---|---|---|
| 9 Jun, 25 | ALB | Buy | USD 59.83 | USD 62.8 | USD 65.8 | 2 days | Closed |
9.89%
|
*Return(%) represent the percentage change between the entry price and exit price of the recommendation.
Data Powered by EOD Historical Data (“EODHD”).
Albemarle Corporation develops, manufactures, and markets engineered specialty chemicals worldwide. It operates through three segments: Energy Storage, Specialties and Ketjen. The Energy Storage segment offers lithium compounds, including lithium carbonate, lithium hydroxide, and lithium chloride; technical services for the handling and use of reactive lithium products; and lithium-containing by-products recycling services. The Specialties segment provides bromine-based specialty chemicals, including elemental bromine, alkyl and inorganic bromides, brominated powdered activated carbon, and other bromine fine chemicals; lithium specialties, such as butyllithium and lithium aluminum hydride; develops and manufactures cesium products for the chemical and pharmaceutical industries; and zirconium, barium, and titanium products for pyrotechnical applications that include airbag initiators. The Ketjen segment offers clean fuels technologies (CFT), which is composed of hydroprocessing catalysts (HPC) together with isomerization and akylation catalysts; fluidized catalytic cracking (FCC) catalysts and additives; and performance catalyst solutions (PCS), which is composed of organometallics and curatives. The company serves the energy storage, petroleum refining, consumer electronics, construction, automotive, lubricants, pharmaceuticals, and crop protection markets. Albemarle Corporation was founded in 1887 and is headquartered in Charlotte, North Carolina.
Specialties segment adjusted EBITDA rose by 29.8%, from $45.2 million to $58.7 million
Operating cash flow improved to $545 million, up $447 million from the prior-year period.
Total company net sales declined by 21% year-over-year, from $1.36 billion in Q1 2024 to $1.08 billion in Q1 2025.
Energy Storage segment net sales fell by 35% to $525 million, primarily driven by a 34% drop in pricing.
Albemarle faces significant earnings sensitivity to volatile lithium market prices, which could materially impact its revenue, profitability, and capital allocation plans despite ongoing cost optimization efforts
| Entry Price | Support* | Target 1 | Target 2 |
|---|---|---|---|
| 59.83 | 54.0 | 62.8 | 65.8 |
Data Source: REFINITIV, Analysis: StockNextt
*Support can be considered as an indicative stop-loss, and if prices move below that level on closing basis individuals may evaluate exiting the position depending on their risk appetite, previous holdings, and other factors considered. The support and resistance levels may need to be re-evaluated within 4-6 weeks’ time frame depending on the stock price movements from the date of recommendation on the stock.
Solid Operational Performance and Strategic Focus
Albemarle Corporation reported first-quarter 2025 net sales of USD 1.1 billion, down 21% year-over-year, primarily due to lower pricing in its Energy Storage segment. However, the company achieved double-digit volume growth in its Specialties division (+11%) and record lithium salt production across its integrated conversion network. Adjusted EBITDA for the quarter stood at USD 267 million, reflecting an 8% year-over-year decline, while net income attributable to Albemarle surged to USD 41 million from USD 2.4 million in Q1 2024. Operating cash flow was USD 545 million, significantly supported by a USD 350 million customer prepayment, resulting in an adjusted operating cash flow conversion rate of 73%, excluding the prepayment.
Segment Highlights: Energy Storage and Specialties
The Energy Storage segment experienced a 35% decline in net sales to USD 525 million, primarily due to a 34% drop in pricing, while production volumes remained flat owing to record output at Albemarle’s integrated facilities. Adjusted EBITDA for Energy Storage reached USD 186 million, a 6% year-over-year decrease, mitigated by lower input costs and continued cost reductions. In contrast, the Specialties segment recorded net sales of USD 321 million (+2%) and an adjusted EBITDA increase of nearly 30% to USD 59 million, driven by higher volumes and efficiency gains from productivity initiatives.
Ketjen Segment Sees Robust Profit Growth
Ketjen’s first-quarter net sales declined slightly by 5% year-over-year to USD 231 million, with a 4% increase in prices offset by an 8% reduction in volumes, largely due to the timing of sales. Nonetheless, adjusted EBITDA for Ketjen surged by 76% to USD 39 million, fueled by a favorable product mix and increased contributions from joint ventures.
Full-Year 2025 Outlook Maintained Amid Market Uncertainty
Albemarle maintained its full-year 2025 guidance despite uncertainties surrounding global trade actions and tariffs announced as of April 29, 2025. The company projects full-year net sales between USD 4.9 billion and USD 5.2 billion under observed market pricing conditions (~USD 9/kg LCE). Energy Storage volumes are anticipated to grow by up to 10% year-over-year. Specialties net sales are expected to range between USD 1.3 billion and USD 1.5 billion, while Ketjen net sales are forecasted between USD 1.0 billion and USD 1.1 billion, with continued focus on product mix optimization and cost discipline.
Capital Allocation and Strengthened Liquidity
Capital expenditures are projected at USD 700 million to USD 800 million for 2025, marking a more than 50% reduction from 2024 levels. This reflects Albemarle’s strategic prioritization of sustaining current assets and selective high-return growth projects. As of March 31, 2025, the company reported a strong liquidity position of approximately USD 3.1 billion, including USD 1.5 billion in cash and equivalents and USD 1.5 billion in available revolver capacity. Total debt stood at USD 3.5 billion, translating to a net debt-to-adjusted EBITDA ratio of roughly 2.4 times.
Tax and Cash Flow Developments
The effective income tax rate for Q1 2025 was 21.0%, compared to 2.2% in Q1 2024. On an adjusted basis, the tax rate shifted to (42.8)% from (12.4)%, reflecting changes in geographic income mix and valuation allowances in Australia and China. The company’s cash from operations improved by USD 447 million year-over-year, primarily due to the customer prepayment and better working capital management, while capital expenditures decreased significantly to USD 183 million as major capacity expansions were completed.
Considering recent key business, financial updates, current trading levels, and key business risks, a ‘Buy’ recommendation has been given on Albemarle Corporation (NYSE: ALB) at the closing market price of USD 59.83, as on June 06, 2025.
Data Powered by EOD Historical Data (“EODHD”).
Sector: Basic Materials Industry: Specialty Chemicals
| Company | Change (USD) | Price (USD) | Trailing PE (x) | Forward PE (x) | Price Sales TTM (x) | Price to Book Value (x) | Enterprise Value to Revenue (x) | Enterprise Value to EBITDA (x) |
|---|---|---|---|---|---|---|---|---|
| ALB Albemarle Corp |
-0.78 1.15% | 67.21 | - | 37.17 | 1.98 | 1.54 | 2.53 | 22.45 |
| LIN Linde plc Ordinary Shares |
-1.59 0.33% | 475.58 | 33.77 | 28.90 | 6.56 | 5.42 | 7.03 | 18.92 |
| AIQUF L'Air Liquide S.A |
-1.085 0.52% | 206.15 | 29.39 | 24.69 | 3.41 | 3.97 | 3.87 | 15.91 |
| AIQUY Air Liquide SA ADR |
-0.18 0.43% | 41.34 | 30.34 | 23.04 | 3.63 | 3.77 | 3.88 | 15.62 |
| SHW Sherwin-Williams Co |
1.49 0.42% | 354.00 | 33.33 | 27.40 | 3.38 | 20.60 | 3.88 | 21.36 |
Data Powered by EOD Historical Data (“EODHD”).
Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.
Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is Jun 06,2025. The reference data in this report has been partly sourced from REFINITIV.
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Target: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Target 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Target 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
Disclaimer :
This report has been issued by StockNextt which has an Ontario Business Identification Number 1000958347 and British Columbia registration Number FM1051529 is a trade name under Kalkine Canada Advisory Services Inc. having Business Number 761925130BC0001. Kalkine Canada Advisory Services Inc. and StockNextt are collectively referred to as “StockNextt”, “we”, “us”, and “our”. The website https://stocknextt.com and associated pages are published by StockNextt. The information in this report and on the StockNextt website has been prepared from a wide variety of sources, which StockNextt, to the best of its knowledge and belief, considers accurate. StcokNextt has made every effort to ensure the reliability of information contained in its reports, newsletters, and websites. All information represents our views at the date of publication and may change without notice. The information in this report does not constitute an offer to sell securities or other financial products or a solicitation of an offer to buy securities or other financial products. Our reports contain general recommendations for investing in securities and other financial products. StockNextt does not offer financial advice based upon your personal financial situation or goals, and we shall not be held liable for any investment or trading losses you may incur by using the opinions expressed in our reports, publications, market updates, news alerts and corporate profiles. StockNextt does not intend to exclude any liability which it is not permitted to exclude under applicable law or regulation. StockNextt’s general advice does not in any way endorse or recommend individuals, investment products or services for your personal financial situation. You should discuss your portfolios and the risk tolerance level appropriate for your personal financial situation, with a professional authorised financial planner and adviser. You should be aware that the value of any investment and the income from it can go down as well as up and you may not get back the amount invested. Please also read our Terms and conditions for further information. Employees and/or associates of StockNextt and its related entities may hold an interest in the securities or other financial products covered in this report or on the StockNextt website. Any such employees and associates are required to comply with certain safeguards, procedures and disclosures as required by law.
Copyright © 2023 Krish Capital Pty Ltd. All rights reserved. No part of this website, or its content, may be reproduced in any form without our prior consent.
