Shares of specialty chemicals maker AlbemarleALB scaled a fresh 52-week high of $94.94 last Friday, before pulling back to close the day at $94.
Albemarle has a market cap of roughly $10.6 billion and average volume of shares traded in the last three months is around 899.4K. The company has an expected long-term EPS growth of around 10%.
Albemarle's shares have gained 96.2% over a year, outperforming the Zacks categorized Chemicals-Diversified industry's gain of 33.3% over the same period, partly reflecting its forecast-topping earnings performance over the trailing four quarters.
Albemarle's adjusted earnings for third-quarter 2016 topped the Zacks Consensus Estimate. The company raised its earnings outlook for full-year 2016 factoring in favorable performance across its Lithium and Refining Solutions segments.
Albemarle remains focused on strengthening its lithium business. The company recently closed the acquisition of the lithium assets of Jiangxi Jiangli New Materials Science and Technology Co. Ltd. for roughly $145 million. The deal includes manufacturing assets and supporting business functions located in Jiangxi and Sichuan, China focused on making battery-grade lithium hydroxide and lithium carbonate.
The acquisition will allow Albemarle to supply premium lithium salts to an expanded global customer base and accelerate the company's ability to meet its goal of capturing 50% of the growth in the lithium industry. The Jiangli New Materials assets have a total lithium salts capacity of 15,000 metric tons per year.
Albemarle, in Sep 2016, also entered into a deal with Bolland Minera S.A. that provided the former exclusive exploration and acquisition rights to a lithium resource in Antofalla (within the Catamarca Province of Argentina), which could prove to be the biggest lithium resource in Argentina.
Moreover, Albemarle recently agreed to amend its lithium production rights agreement with the Chilean Economic Development Agency, effective Dec 30, 2016, to extend the term of the deal and increase the company's authorized lithium quota at its facility in the Salar de Atacama, Chile.
The amended agreement offers Albemarle with adequate lithium to make more than 80,000 metric tons of technical and battery grade lithium salts annually over the next 27 years at the company's expanding battery grade manufacturing plants in La Negra, Antofagasta. The agreement will also allow Albemarle to further support growth of its long-term customers in the energy storage market and other high growth applications.
Albemarle is also selling non-core businesses and assets to boost growth opportunities and focus on its key businesses. As part of this move, the company recently completed the sale of its Chemetall Surface Treatment unit to German chemical giant BASF for around $3.2 billion. The sale is a part of Albemarle's sustained commitment to boost shareholder value by investing in the growth of its high priority businesses.
Last year, the company also wrapped up the sale of its mineral flame retardants and specialty chemicals businesses to Huber Engineered Materials. Albemarle also completed the divestiture of the tribotecc metal sulfides business to Treibacher Industrie AG. The divestment advances the company's strategic plan of focusing on its core bromine, lithium, catalysts and surface treatment businesses.
Albemarle currently carries a Zacks Rank #2 (Buy).
Albemarle Corporation Price and Consensus
Other Stocks to Consider
Other well-placed companies in the chemical space include The Chemours Company CC , Methanex Corporation MEOH and Kronos Worldwide, Inc. KRO , all holding a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Chemours has an expected long-term growth of 15.5%.
Methanex has an expected long-term growth of 15%.
Kronos has an expected long-term growth of 5%.
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