Albemarle Corp

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ALB : NYSE : Basic Materials
$93.05 up 0.45 | 0.49%
Today's Range: 92.54 - 94.41
Avg. Daily Volume: 931500.0
01/19/17 - 4:02 PM ET

Financial Analysis


ALBEMARLE CORP's gross profit margin for the third 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 has weak liquidity. Currently, the Quick Ratio is 0.67 which shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

At the same time, stockholders' equity ("net worth") has remained virtually unchanged only increasing by 4.91% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q3 FY16 Q3 FY15
Net Sales ($mil)654.01693.22
EBITDA ($mil)181.05192.87
EBIT ($mil)133.06123.96
Net Income ($mil)128.2265.39


Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)233.6234.49
Total Assets ($mil)9396.949675.06
Total Debt ($mil)3449.333843.33
Equity ($mil)3299.023144.49


Profitability Q3 FY16 Q3 FY15
Gross Profit Margin43.8842.67
EBITDA Margin27.6827.82
Operating Margin20.3417.88
Sales Turnover0.310.28
Return on Assets2.291.46
Return on Equity17.383.94
Debt Q3 FY16 Q3 FY15
Current Ratio1.451.3
Debt/Capital0.510.55
Interest Expense15.9519.29
Interest Coverage8.346.43


Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)112.47112.2
Div / share0.310.29
EPS0.930.48
Book value / share29.3328.03
Institutional Own % n/a n/a
Avg Daily Volume900213.01212116.0

Valuation


BUY. The current P/E ratio indicates a significant discount compared to an average of 29.58 for the Chemicals industry and a discount compared to the S&P 500 average of 25.49. Conducting a second comparison, its price-to-book ratio of 3.20 indicates a premium versus the S&P 500 average of 2.84 and a significant discount versus the industry average of 5.43. 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 18.42 Peers 29.58   ALB 21.25 Peers 14.77

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.

 

Premium. 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 significant premium 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 23.44 Peers 21.09   ALB 1.05 Peers 2.07

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 significant premium to its peers.

 

Discount. 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 discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
ALB 3.20 Peers 5.43   ALB 384.76 Peers -13.84

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 3.62 Peers 2.31   ALB 7.71 Peers -5.52

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.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

ALB has a sales growth rate that significantly exceeds its peers.

 

 

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