The stock of Charlotte-based Albemarle Corp. has climbed more than 30% this year on analyst predictions that rising lithium prices, coupled with cost cuts and other steps, are going to buoy the shares.
Albermarle rose 3.84% to $186.97 at midday after jumping 27.3% year to date through yesterday. The stock set a 52-week high.
Efforts by CEO Kent Masters to reduce capital spending, cut costs and sell assets are paying off, helping increase Albemarle’s free cash flow, as rising lithium prices “should be helpful in contract negotiations when they are due for a rollover in the next 18-24 months,’’ HSBC said earlier this week.
HSBC upgraded Albemarle to “buy’’ from “hold’’ and raised its price target to $200 from $117. Truist also raised its outlook to “buy’’ from “hold’’ and lifted the target price to $205 from $125.
The moves follow recent stock upgrades and higher price targets by several other analysts. Half of analysts covering the company rate the shares as “buy,” up from about 33% in November, Barron’s reported Wednesday. On average, analysts’ price targets have climbed to about $167 from $90 over that period.
“These upgrades suggest a broadly optimistic view among analysts regarding Albemarle’s prospects in the evolving lithium market,’’ Investing.com posted in an article on Wednesday.
Albemarle develops and manufactures lithium compounds for broad industrial uses, including batteries for electric vehicles and consumer electronics. As demand for utility-scale battery storage is increasing, benchmark lithium prices are rebounding. They declined in recent years as rising lithium production collided with slowing demand for electric vehicles, according to Barron’s.
Albemarle is scheduled to report fourth-quarter and full-year results Feb. 11. Zacks projects the company will narrow its adjusted quarterly loss to 62 cents from $1.09 a year earlier, while boosting revenue 11.2% to $1.37 billion.
The company told investors last November it anticipated 2025 capital spending of about $600 million, down 65% from a year earlier. Asset sales are projected to generate pre-tax cash proceeds of roughly $660 million, according to its third-quarter financial presentation.
“Albemarle is expected to rebound strongly in 2026 as the lithium market recovers,’’ Barchart.com posted in an earnings preview last week. “Cost reductions and divestitures position Albemarle for future growth and stability.’’
