Why Albemarle Stock Could Have a Major Run This Year

Key Points

• Albemarle stock has fallen to a discount that attracted institutional buyers to come in and buy up shares of this high upsdie name.
• Wall Street analysts keep a double-digit upside potential for this company moving forward.
• Financial performance and guidance justify the double-digit upside present in Albemarle today.

Price action is typically a great indicator of a company’s present and future, as the market prices in today's available information, along with the next three to six months of fundamentals. A stock’s price is a consensus view of where the collective thought is for the business in question. However, the price isn’t always right, and big swings might create an opportunity for investors to close the gap and make a profit.

This is why tracking stocks that have been beaten down can be lucrative, as long as the fundamentals align for the opportunity to become real and not just a trap. Hundreds of investors have been trapped throughout history by buying beaten-down stocks on price alone, only to hold a losing position for a long time. Because the homework wasn’t done correctly, these buyers were pointed in the right fundamental direction.

Today’s divergence between price and fundamentals comes in shares of Albemarle Co. NYSE: ALB, a chemical player in the United States' manufacturing sector. While there are many reasons to keep the price low as it is today, due to the volatility and uncertainty regarding global trade as President Trump shifts the landscape through tariffs, the future of Albemarle represents a fantastic risk-to-reward ratio for buyers today.

Big Buyers Are Warming Up to Albemarle’s Story

As of May 2025, institutional buyers from the Vanguard Group decided to boost their holdings in Albemarle stock by 0.5%. While this may not sound like much on a percentage basis, the new allocation brought the group’s net position to a high of $1 billion, or 12.5% ownership in the company today.

With this new vote of confidence from one of Wall Street’s biggest players, investors can expect more bullish confidence for Albemarle stock moving forward. More than just this recent buying, there are other factors to consider in this company down the line.

One such factor is the earnings per share (EPS) forecasted by Wall Street analysts for the third quarter of 2025. They are shooting for up to $2.97, representing a massive jump from today’s reported net loss of $0.62 per share. As most investors know, where EPS goes, so does the stock price, showing the benefit of being a buyer in Albemarle at today’s prices.

This is where the consensus price target set by Wall Street analysts comes into play, as today they see a valuation of up to $92.4 per share. Considering that Albemarle stock trades at only 44% of its 52-week high, this valuation calling for as much as 53.7% upside would tilt the scale deeply in favor of the bulls who recognize that Albemarle's reality is deeply disconnected from the price.

Reasons To Push Albemarle Higher

Breaking down some fundamental drivers in Albemarle’s business can be an essential factor to consider today. Most of these are in the company’s latest quarterly earnings presentation. Albemarle’s management leans on the fact that global electric vehicle sales are set to keep growing by double digits down the line.

This significant tailwind will push lithium demand (Albemarle’s expertise) through the roof, hence the company's bold but realistic EPS forecasts down the line. Of course, some of this upside pressure comes from the current supply and production capacity not being set up correctly to meet this new demand.

As the market price of lithium moves higher, Albemarle’s profits and margins are set to also push much higher from where they are today, compounding the value creation for the stock and its shareholders. Even before all of these forecasts become a reality, bullish signs are already coming out of the company’s top line.

Revenue for the quarter reached $1.1 billion, which is a decline from the same quarter last year. However, this is not a company-specific issue but rather an industry-wide slowdown due to the effect of recent trade tariffs and the slowdown in orders they have inevitably caused.

With this in mind, investors can see that these factors might become a thing of the past, seeing that management has guided for up to $1.3 billion to $1.5 billion in revenue to start showing the effects of more demand, along with higher lithium prices starting to push the company’s profit higher.

Another sign of confidence coming in from the markets is the one-month stock performance of up to 13.7%, which shows investors where the consensus for the future might be starting to emerge. Seeing the short-term price action turning around for Albemarle is a good sign of better things to come.

This time, the turnaround in the price might be justified by the underlying industry dynamics shown in the company’s financials to crystallize the double-digit upside forecasted by Wall Street analysts today.