Albemarle Shares Surge 76% in a Year: What's Driving the Rally?

Albemarle Corporation’s ALB shares have shot up 76.3% over the past year. The company has also outperformed the Zacks Chemical - Diversified industry’s 20% decline over the same time frame. The rally has been driven by a rebound in lithium prices, improving demand from the electric vehicle and energy storage markets, better-than-expected earnings supported by cost-cutting initiatives and renewed investor confidence. 

Let’s take a look at the factors that are driving ALB stock. 

ALB Gains as Lithium Conversion Capacity Ramps Up

Albemarle’s impressive stock rally is driven by a convergence of strengthening lithium market fundamentals and improving company-specific performance. Fundamentally, the company remains a dominant force in the global lithium supply chain, and its long-term demand outlook has been reinforced by the accelerating adoption of electric vehicles, the rising deployment of grid-scale energy storage systems and the broader industrial use of lithium-ion batteries.  

After a prolonged downturn, lithium prices have begun stabilizing and rebounding, helped by tightening supply conditions, slower capacity additions from global producers and improving sentiment across battery metals. Global EV sales surged 30% year over year in the first nine months of 2025, driven by China and Europe battery electric vehicles, per the company. Lithium demand also rose 30% in the same period on the back of energy transition and higher global demand for EVs and grid storage. ALB expects lithium demand to rise at a compound annual growth rate (CAGR) of 15-30% from 2024 to 2030. 

Operationally, Albemarle has delivered cost-optimization initiatives, improved productivity across its energy-storage segment and reported results that exceeded the consensus estimate, particularly in EBITDA and free cash flow, fueling investor conviction that the company is successfully managing volatility in lithium markets. 

Albemarle is steadily expanding its global lithium conversion capacity through high-return projects, helping boost productivity and support strong customer demand. In the third quarter of 2025, the company recorded higher Energy Storage sales volumes driven by record output from its integrated facilities. Key projects are also advancing well, including the Salar yield improvement initiative in Chile, now operating at 50%, and the Meishan conversion plant in China, which is ramping up ahead of schedule. 

ALB’s Zacks Rank & Key Picks

ALB currently carries a Zacks Rank #3 (Hold). 

Some better-ranked stocks in the Basic Materials space are Kinross Gold Corporation KGC, LSB Industries, Inc. LXU and Avino Silver & Gold Mines Ltd. ASM.

At present, KGC and LXU sport a Zacks Rank #1 (Strong Buy), while ASM carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. 

The Zacks Consensus Estimate for KGC’s current-year earnings is pegged at $1.68 per share, indicating a year-over-year rise of 147%. Its earnings beat the Zacks Consensus Estimate in three of the trailing four quarters while missing once, with the average surprise being 17.4%. KGC shares have gained 210.5% over the past year. 

The Zacks Consensus Estimate for LXU’s current fiscal-year earnings is pinned at 36 cents per share, indicating a 56.5% year-over-year increase. Its earnings beat the Zacks Consensus Estimate in two of the trailing four quarters while missing twice, with the average surprise being 141.3%. Its shares have popped around 2.2% over the past year. 

The Zacks Consensus Estimate for ASM’s current-year earnings stands at 17 cents per share, implying a 13.3% year-over-year increase. Its earnings beat the Zacks Consensus Estimates in each of the trailing four quarters, with the average earnings surprise being 150%. ASM’s shares have rallied roughly 589% over the past year. 

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This article originally published on Zacks Investment Research (zacks.com).

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