uploads/2019/03/Part-2-ALB-Div-yield-Q1-2019-1.png

How Is Albemarle’s Dividend Yield Trending?

By

Updated

Albemarle’s dividend yield

At the close of market on March 14, Albemarle (ALB), one of the biggest lithium producers, had a dividend yield of ~1.75%. ALB’s dividend yield has more or less remained constant compared to its dividend yield at the end of the fourth quarter of 2017.

In comparison, FMC (FMC), W.R. Grace (GRA), and Sociedad Química y Minera de Chile (SQM) have current dividend yields of 2.06%, 1.40%, and 3.3%, respectively.

Although Albemarle’s dividend yield has risen ~30 basis points compared to last year, it still trails its peers, which include FMC, W.R. Grace, and Sociedad Química y Minera de Chile.

Article continues below advertisement

At the same time, Albemarle’s yield is lower than the ~2.5% yield generated by the one-year Treasury bond. As a result, dividend investors and long-term investors might not see Albemarle as an alternative instrument, but Albemarle does have the potential to provide capital gains to investors. The company will likely increase its dividend rate in the first quarter of 2019, which could drive its dividend yield higher.

What’s driving ALB’s dividend yield?

Albemarle’s dividend yield has recovered significantly since the fourth quarter of 2017, when it fell below 0.9%. Since then, though, its dividend yield has risen and has remained stable at above 1.5%. The main reasons for ALB’s improved dividend yield are the increase in its dividend and the significant increase in its stock price.

Those interested in holding Albemarle indirectly may want to consider the Global X Lithium ETF (LIT), which has invested 5.5% of its portfolio in Albemarle as of March 14, 2019.

Advertisement

More From Market Realist