Albemarle to Post Q1 Earnings: What's in the Offing for the Stock?

Albemarle Corporation ALB is slated to release first-quarter 2025 results after the closing bell on April 30.

The company missed the Zacks Consensus Estimate for earnings in each of the trailing four quarters. In this timeframe, it delivered a negative earnings surprise of 160.2%, on average. It posted a negative earnings surprise of 122.5% in the last reported quarter. ALB is likely to have benefited from its cost and productivity actions in the first quarter amid headwinds from softer lithium market prices.

ALB’s shares have lost 51.3% over the past year compared with the Zacks Chemicals Diversified industry’s 24.4% decline.

Let’s see how things are shaping up for this announcement.

What Do ALB’s Revenue Estimates Say?

The Zacks Consensus Estimate for revenues for Albemarle for the to-be-reported quarter stands at $1,171.4 million, reflecting a decline of around 13.9% from the year-ago quarter.

The consensus estimate for net sales for the Energy Storage unit for the first quarter is pegged at $588.6 million, reflecting a year-over-year decline of 26.5%.

The Zacks Consensus Estimate for net sale for the Specialties unit is pinned at $330 million, suggesting a year-over-year rise of 4.4%.

The Zacks Consensus Estimate for net sales for the Ketjen unit stands at $243.9 million, flat year over year.

Factors to Watch for ALB Stock

The benefits of ALB’s cost-saving, pricing and productivity initiatives are expected to get reflected in the March quarter. Its cost and productivity actions are expected to have supported margins in the quarter. Efforts to drive operating efficiency and improve the utilization of raw materials are likely to have aided the company’s performance.

Albemarle is taking actions to cut costs, optimize its conversion network and increase efficiencies to preserve its long-term competitive position. It has made progress with the earlier-announced comprehensive review of its cost and operating structure. It expects the annual run-rate cost savings related to the comprehensive review to be in the range of $300-$400 million. 

ALB achieved more than 50% run rate of the cost improvement target at the end of 2024 and expects to achieve a full run rate by the end of 2025. Roughly $150 million of the target is related to manufacturing cost opportunities. 

Soft lithium market prices are likely to have impacted the company’s performance. Lithium prices have declined amid slowing demand growth for EVs, inventory glut and increased supply. The uncertain macroeconomic environment and high interest rates have weighed on demand.  Weaker lithium prices are likely to have hurt ALB’s top line and margins in the first quarter.

Albemarle Corporation Price and EPS Surprise

Albemarle Corporation price-eps-surprise | Albemarle Corporation Quote

What Our Model Unveils for ALB Stock

Our proven model does not conclusively predict an earnings beat for ALB this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.

Earnings ESP: Earnings ESP for ALB is -2.99%. The Zacks Consensus Estimate for the first quarter is currently pegged at a loss of 62 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: ALB currently carries a Zacks Rank #3.

(Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Basic Materials Stocks That Warrant a Look

Here are some companies in the basic materials space you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:

CF Industries Holdings, Inc. CF, scheduled to release earnings on May 7, has an Earnings ESP of +3.67% and carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

The consensus estimate for CF’s earnings for the first quarter is currently pegged at $1.47.

ATI Inc. ATI, slated to release earnings on May 1, has an Earnings ESP of +2.46% and carries a Zacks Rank #3 at present.

The consensus mark for ATI’s first-quarter earnings is currently pegged at 58 cents.

Kinross Gold Corporation KGC, scheduled to release earnings on May 6, has an Earnings ESP of +11.07%.

The Zacks Consensus Estimate for Kinross Gold's earnings for the first quarter is currently pegged at 22 cents. KGC currently carries a Zacks Rank #2.

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

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