Reviewing Albemarle’s Stock Performance since 3Q17

Albemarle (ALB) is set to announce its 4Q17 results after the market closes on February 27, 2018, and hold a conference call the next day. In this series, we’ll look at ALB’s stock performance since its 3Q17 earnings announcement, and its short interest. We’ll also look at analysts’ revenue and EPS (earnings per share) estimates and latest recommendations for the stock.

After ALB declared its 3Q17 results on November 8, 2017, the stock had fallen 21.8% as of February 21, 2018. It underperformed peers Sociedad Química y Minera (SQM), FMC (FMC), and W.R. Grace (GRA), which fell 4.8%, 10.4%, and 9.4%, respectively.

The decline in ALB stock was primarily due to fear that lithium prices could fall because of news that SQM’s dispute with Chile’s economic development agency had been resolved and SQM was approved to significantly increase lithium production. However, many analysts expect the stock price to bounce back due to continued demand for lithium. Also, ALB has sold part of its performance catalyst solutions business to W.R. Grace.

ALB’s stock price fell, and the stock is now trading 12.5% below its 100-day moving average of $129.21. ALB’s 14-day RSI (relative strength index) score of 49 indicates that the stock is neither overbought nor oversold. An RSI score of 30 or below indicates that the stock may be oversold, while an RSI score of 70 or above indicates that the stock may be overbought. Investors can indirectly hold ALB through the Materials Select Sector SPDR ETF (XLB), which had invested 1.9% of its portfolio in Albemarle as of February 21, 2018.