Friday, March 24, 2023
HomeMarketLithium Miner Albemarle Wowed Wall Street. Another Analyst Says Buy the Stock.

Lithium Miner Albemarle Wowed Wall Street. Another Analyst Says Buy the Stock.

Albemarle’s lithium products help power the world’s growing fleet of electric vehicles.

- Advertisement -

Logan Cyrus/Bloomberg

More electric vehicles are being made and sold. More lithium is being used for batteries, and that’s good for the world’s biggest lithium miner,

(ticker: ALB) on Tuesday told analysts and investors that it sees industry production volumes up about fivefold from 2022 to 2030. The company itself plans to triple capacity by 2027.

It was a strong outlook, and one of the reasons Piper Sandler analyst Charles Neivert launched coverage of Albemarle stock on Wednesday evening with a Buy rating and $310 price target. That’s a reflection of Albemarle’s strong earnings, which could grow at more than 20% a year on average between 2022 and 2024.

“Growth in EV production is the single biggest driver for ALB shares over at least the next 3 to 5 years,” Neivert writes in a research report. “Albemarle is well positioned to continue to participate in the market growth.”

Still, Albemarle stock trades for about 10 times 2024 earnings, well below the
S&P 500
‘s 16 times. And even at Neivert’s target, Albemarle would trade for just around 12 times 2024 estimates.

That’s a reflection of lithium prices, which are elevated relative to history. Benchmark lithium prices are at about $60,000 a metric ton, up from pandemic prices of less than $10,000 a ton. No one expects lithium prices to stay up here. “The urgency around lithium supply will diminish,” adds Neivert. “We still see lithium prices remaining well above historical values of 2021-2022.”

The question is how much. Evercore ISI analyst Stephen Richardson believes prices will average about $30,000 a ton in the long run. He also rates Albemarle stock Buy. His price target is $295 a share.

Other analysts left the event feeling optimistic about Albemarle stock. Thursday, Mizuho analyst Christopher Parkinson raised his price target on Albemarle stock to $325 from $300. Earlier in the week, analysts at Deutsche Bank, Oppenheimer, RBC, and Baird all raised targets as well.

The average analyst price target for Albemarle stock is now about $311, up from about $250 at the start of 2022.

Overall, 62% of analysts covering Albemarle rate shares at Buy. The average Buy-rating ratio for stocks in the S&P 500 is about 58%.

Albemarle stock is up 2.9% in Thursday trading, while the S&P 500 and
Dow Jones Industrial Average
are up about 0.5% and 0.2%, respectively.

Albemarle stock is up more than 11% for the week. Other lithium-mining stocks have moved as well.
(LTHM) and
) shares are up both up about 9%. week to date.

Write to Al Root at


- Advertisment -

Most Popular