NEW YORK (TheStreet) -- Albemarle (ALB - Get Report) stock is down by 8.45% to $49.64 in late afternoon trading on Thursday, following an agreement to sell its Tribotecc metal sulfides business to Austria-based chemistry and metallurgy company Treibacher Industrie.
The deal covers sites in Vienna, Austria and Arnoldstein, Austria, as well as Tribotecc's proprietary sulfide synthesis process, according to a statement.
Bank of America/Merrill Lynch is the exclusive financial adviser for the deal, which is expected to close by the end of 2015.
Financial terms were not disclosed.
"This transaction furthers Albemarle's strategic plan of focusing on our core bromine, lithium, catalysts and surface treatment businesses," CEO Luke Kissam said in a statement.
Separately, TheStreet Ratings team rates ALBEMARLE CORP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
We rate ALBEMARLE CORP (ALB) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, increase in net income and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, generally higher debt management risk and disappointing return on equity.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- ALB's very impressive revenue growth greatly exceeded the industry average of 19.1%. Since the same quarter one year prior, revenues leaped by 54.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Chemicals industry. The net income increased by 132.3% when compared to the same quarter one year prior, rising from $22.45 million to $52.15 million.
- 42.44% is the gross profit margin for ALBEMARLE CORP which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 5.59% trails the industry average.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. In comparison to the other companies in the Chemicals industry and the overall market, ALBEMARLE CORP's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- Net operating cash flow has decreased to $87.39 million or 40.13% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
- You can view the full analysis from the report here: ALB