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Albemarle (ALB) to Post Q3 Earnings: What's in the Cards?

Zacks Equity Research
·4-min read

Albemarle Corporation ALB will release third-quarter 2022 results after the closing bell on Nov 2.

The company beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters. In this timeframe, it delivered an earnings surprise of 24.2%, on average. It posted an earnings surprise of 13.9% in the last reported quarter. The company is likely to have benefited from higher lithium volumes and prices and its cost-reduction actions in the third quarter.

Albemarle’s shares have gained 9.5% over a year compared with a 12.1% decline of the industry it belongs to.

 

Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

 

Zacks Model

Our proven model predicts an earnings beat for Albemarle this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earning beat.

Earnings ESP: Earnings ESP for Albemarle is +3.64%. The Zacks Consensus Estimate for the third quarter is currently pegged at $6.84. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Albemarle currently carries a Zacks Rank #1.

What do the Estimates Say?

The Zacks Consensus Estimate for revenues for Albemarle for the to-be-reported quarter stands at $2,118 million, reflecting an increase of around 155% from the year-ago quarter.

The Zacks Consensus Estimate for net sales for the Lithium unit stands at $1,346 million, indicating a 274.9% year-over-year rise.

The consensus estimate for the Bromine Specialties segment for the third quarter is pegged at $358 million, reflecting an 28.8% increase on a year-over-year basis.
 
The Zacks Consensus Estimate for net sales for the Catalysts segment is pinned at $214 million, suggesting a 10.3% year-over-year rise.

Some Factors to Watch For

Albemarle is likely to have benefited from higher volumes in its lithium business in the third quarter. Higher lithium prices are also expected to have aided its performance.

The company’s bromine business is also expected to have gained from strong demand and favorable pricing led by tight market conditions, offsetting headwinds from higher raw material and freight costs. Albemarle is likely to have witnessed continued strong demand for flame retardants in the third quarter.

The performance in the Catalysts segment is also likely to have been driven by higher pricing. However, the segment is likely to have witnessed continued challenges from increased input costs, especially higher natural gas costs in Europe due to the Russia-Ukraine war.

Benefits of the company’s cost-saving, pricing and productivity initiatives are also expected to get reflected in the quarter to be reported. Its cost and productivity actions are expected to have supported margins in the third quarter.

Albemarle Corporation Price and EPS Surprise

 

Albemarle Corporation Price and EPS Surprise
Albemarle Corporation Price and EPS Surprise

Albemarle Corporation price-eps-surprise | Albemarle Corporation Quote

 

Stocks That Warrant a Look

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

Koppers Holdings Inc. KOP, slated to release earnings on Nov 4, has an Earnings ESP of +2.28% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Koppers’ third-quarter earnings has been revised 2.6% upward in the past 60 days. The consensus estimate for KOP’s earnings for the quarter is currently pegged at $1.17.

ATI Inc. ATI, scheduled to release earnings on Nov 2, has an Earnings ESP of +1.15%.

The Zacks Consensus Estimate for ATI's earnings for the third quarter is currently pegged at 52 cents. ATI currently carries a Zacks Rank #3.

Huntsman Corporation HUN, scheduled to release earnings on Nov 4, has an Earnings ESP of +3.59%.

The consensus estimate for Huntsman’s third-quarter earnings is currently pegged at 72 cents. HUN currently carries a Zacks Rank #3.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
ATI Inc. (ATI) : Free Stock Analysis Report
 
Albemarle Corporation (ALB) : Free Stock Analysis Report
 
Koppers Holdings Inc. (KOP) : Free Stock Analysis Report
 
Huntsman Corporation (HUN) : Free Stock Analysis Report
 
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Zacks Investment Research