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If You Invested $1000 in Albemarle 10 Years Ago, This Is How Much You'd Have Now

·4 min read

How much a stock's price changes over time is a significant driver for most investors. Not only can price performance impact your portfolio, but it can help you compare investment results across sectors and industries as well.

The fear of missing out, or FOMO, also plays a factor in investing, especially with particular tech giants, as well as popular consumer-facing stocks.

What if you'd invested in Albemarle (ALB) ten years ago? It may not have been easy to hold on to ALB for all that time, but if you did, how much would your investment be worth today?

Albemarle's Business In-Depth

With that in mind, let's take a look at Albemarle's main business drivers.

Charlotte, NC-based Albemarle Corporation is a premier specialty chemicals company with leading positions in attractive end markets globally. It is a leading producer of highly-engineered specialty chemicals geared to meet customer requirements across a bevy of end markets including petroleum refining, consumer electronics, energy storage, construction and automotive.

Albemarle, in January 2015, completed its acquisition of Rockwood Holdings, Inc for $5.7 billion. Rockwood became a fully-owned subsidiary of Albemarle following the deal closure.

The company’s former Performance Chemicals segment was split in 2016 into two separate segments, Lithium and Advanced Materials and Bromine Specialties. This led to the creation of three reportable segments – Lithium and Advanced Materials, Bromine Specialties and Refining Solutions.

Albemarle, in April 2018, completed the sale of its polyolefin catalysts and components business to W. R. Grace & Co. (GRA). Per the terms of the deal, the curatives and organometallics portions of the Performance Catalysts Solutions (PCS) business remain with Albemarle.

The company realigned its reportable segments following this divestment, effective first-quarter 2018. The PCS business has been merged with the Refining Solutions segment to form a new segment called Catalysts. As such, the company now has three reportable segments – Lithium, Bromine Specialties and Catalysts.

The Lithium unit is a low-cost producer of one of the most diverse portfolios of lithium derivatives in the industry. The segment develops lithium materials (including lithium carbonate and lithium hydroxide) for a vast range of end-use markets.

The company’s bromine business includes products used in fire safety solutions and other specialty chemicals applications.

The Catalysts unit includes product lines such as clean fuels technologies (CFT), FCC catalysts and additives and performance catalystsolutions (PCS).

Albemarle recorded sales of $3,327.9 million in 2021 with Lithium, Bromine Specialties and Catalysts segments accounting 41%, 34%, 23%, respectively. Its other businesses represented the balance 2% of sales.

Bottom Line

While anyone can invest, building a lucrative investment portfolio takes research, patience, and a little bit of risk. If you had invested in Albemarle ten years ago, you're probably feeling pretty good about your investment today.

A $1000 investment made in August 2012 would be worth $4,251.52, or a gain of 325.15%, as of August 11, 2022, according to our calculations. This return excludes dividends but includes price appreciation.

The S&P 500 rose 199.48% and the price of gold increased 6.11% over the same time frame in comparison.

Analysts are anticipating more upside for ALB.

Albemarle’s adjusted earnings and sales for the second quarter of 2022 beat the respective Zacks Consensus Estimate. The company should gain from long-term growth in the battery-grade lithium market. It is expected to benefit from its actions to boost its global lithium derivative capacity. The company will also benefit from the synergies of the Rockwood acquisition. The buyout has enhanced diversity across end markets. The Qinzhou plant buyout will also drive volumes. Albemarle also remains focused on executing its cost-reduction program. Its cost saving actions are also expected to support margins in 2022. The company also remains committed to boost shareholder returns leveraging strong cash flows. It remains focused on maintaining its dividend payout. Albemarle has also outperformed the industry it belongs to over the past year.

Shares have gained 32.30% over the past four weeks and there have been 7 higher earnings estimate revisions for fiscal 2022 compared to none lower. The consensus estimate has moved up as well.
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