Financial Analysis: Albemarle (ALB) and Its Competitors

Albemarle (NYSE:ALB) is one of 296 publicly-traded companies in the “Chemicals” industry, but how does it compare to its rivals? We will compare Albemarle to similar companies based on the strength of its valuation, profitability, risk, earnings, dividends, institutional ownership and analyst recommendations.

Profitability

This table compares Albemarle and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Albemarle	10.40%	14.91%	7.58%
Albemarle Competitors	-54.14%	-0.61%	-1.37%

Insider & Institutional Ownership

92.9% of Albemarle shares are owned by institutional investors. Comparatively, 47.4% of shares of all “Chemicals” companies are owned by institutional investors. 0.4% of Albemarle shares are owned by insiders. Comparatively, 13.7% of shares of all “Chemicals” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Albemarle and its rivals gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Albemarle	$5.14 billion	-$510.63 million	22.50
Albemarle Competitors	$6.34 billion	$229.42 million	19.65

Albemarle’s rivals have higher revenue and earnings than Albemarle. Albemarle is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Albemarle and its rivals, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Albemarle	0	9	15	0	2.62
Albemarle Competitors	3272	12240	14151	521	2.39

Albemarle presently has a consensus target price of $174.05, indicating a potential upside of 86.85%. As a group, “Chemicals” companies have a potential upside of 7.33%. Given Albemarle’s stronger consensus rating and higher probable upside, equities analysts plainly believe Albemarle is more favorable than its rivals.

Dividends

Albemarle pays an annual dividend of $1.64 per share and has a dividend yield of 1.8%. Albemarle pays out 39.6% of its earnings in the form of a dividend. As a group, “Chemicals” companies pay a dividend yield of 3.1% and pay out 104.1% of their earnings in the form of a dividend. Albemarle has increased its dividend for 30 consecutive years.

Volatility & Risk

Albemarle has a beta of 1.34, indicating that its stock price is 34% more volatile than the S&P 500. Comparatively, Albemarle’s rivals have a beta of 0.94, indicating that their average stock price is 6% less volatile than the S&P 500.

Summary

Albemarle beats its rivals on 10 of the 15 factors compared.

About Albemarle

Albemarle Corporation is a specialty chemicals company that produces lithium, bromine and refining catalysts. Its products serve industries including energy storage, transportation, electronics, petroleum refining and pharmaceuticals. The company supplies lithium compounds used in rechargeable batteries and other applications. It also makes bromine-based products for uses such as flame retardants and water treatment, along with catalysts used in refining petroleum. Albemarle traces its history to 1887 and is headquartered in Charlotte, North Carolina.