Albemarle Corp

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ALB : NYSE : Basic Materials
$104.45 | %
Today's Range: 104.03 - 106.178
Avg. Daily Volume: 1011500.0
03/24/17 - 4:02 PM ET

Financial Analysis


ALBEMARLE CORP's gross profit margin for the fourth quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales decreased, the net income has increased, representing an increase to the bottom line. ALBEMARLE CORP is extremely liquid. Currently, the Quick Ratio is 2.47 which clearly shows the ability to cover any short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

During the same period, stockholders' equity ("net worth") has increased by 16.61% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is very unlikely to face financial difficulties in the near future.

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Income Statement Q4 FY16 Q4 FY15
Net Sales ($mil)696.66722.61
EBITDA ($mil)146.97228.38
EBIT ($mil)97.3168.68
Net Income ($mil)602.09174.25


Balance Sheet Q4 FY16 Q4 FY15
Cash & Equiv. ($mil)2269.76213.73
Total Assets ($mil)8161.219615.01
Total Debt ($mil)2369.263852.02
Equity ($mil)3795.063254.39


Profitability Q4 FY16 Q4 FY15
Gross Profit Margin41.7241.24
EBITDA Margin21.0931.6
Operating Margin13.9723.34
Sales Turnover0.330.29
Return on Assets7.883.48
Return on Equity11.639.29
Debt Q4 FY16 Q4 FY15
Current Ratio2.91.13
Debt/Capital0.380.54
Interest Expense16.4214.06
Interest Coverage5.9312.0


Share Data Q4 FY16 Q4 FY15
Shares outstanding (mil)112.52112.22
Div / share0.310.29
EPS0.371.43
Book value / share33.7329.0
Institutional Own % n/a n/a
Avg Daily Volume998797.0927191.0

Valuation


BUY. The current P/E ratio indicates a significant discount compared to an average of 39.05 for the Chemicals industry and a value on par with the S&P 500 average of 26.33. To use another comparison, its price-to-book ratio of 3.12 indicates valuation on par with the S&P 500 average of 2.93 and a significant discount versus the industry average of 6.21. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, ALBEMARLE CORP proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
ALB 26.89 Peers 39.05   ALB 16.13 Peers 15.97

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

ALB is trading at a significant discount to its peers.

 

Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

ALB is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
ALB 21.64 Peers 20.55   ALB 3.62 Peers 1.84

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

ALB is trading at a premium to its peers.

 

Premium. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

ALB trades at a significant premium to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
ALB 3.12 Peers 6.21   ALB 44.81 Peers -19.35

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

ALB is trading at a significant discount to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

ALB is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
ALB 4.42 Peers 2.38   ALB -5.28 Peers -1.63

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

ALB is trading at a significant premium to its industry.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

ALB significantly trails its peers on the basis of sales growth

 

 

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