Would You Still Hold Albemarle Stock If It Fell 30%?
Albemarle (ALB) stock is up 10.6% in 5 trading days. The rally reflects renewed optimism around lithium demand and energy storage growth, but big moves like this often invite a tougher question: is the stock truly resilient when markets reverse?
Before judging its downturn reslience, let’s look at where Albemarle stands today.
- Size: Albemarle is a $15 Bil company with $4.9 Bil in revenue currently trading at $128.14.
- Fundamentals: Last 12 month revenue growth of -23.9% and operating margin of 0.4%.
- Liquidity: Has Debt to Equity ratio of 0.39 and Cash to Assets ratio of 0.11
- Valuation: Albemarle stock is currently trading at P/E multiple of -451.0 and P/EBIT multiple of 2260.0
- Has returned (median) 13.6% within a year following sharp dips since 2010. See ALB Dip Buy Analysis.
These metrics point to a Weak operational performance, alongside High valuation – making the stock Unattractive. For details, see Buy or Sell ALB Stock
That brings us to the key consideration for investors chasing this rally: how resilient is ALB stock if markets turn south? This is where our downturn resilience framework comes in. Suppose ALB stock falls 20-30% to $90 – can investors comfortably hold on? Turns out, the stock has fared worse than the S&P 500 index during various economic downturns, based on (a) how much the stock fell and, (b) how quickly it recovered. Below, we dive deeper into each such downturn.
2022 Inflation Shock
- ALB stock fell 65.2% from a high of $325.38 on 11 November 2022 to $113.26 on 5 December 2023 vs. a peak-to-trough decline of 25.4% for the S&P 500.
- The stock is yet to recover to its pre-Crisis high
- The highest the stock has reached since then is $152.39 on 26 December 2023 , and currently trades at $128.14
| ALB | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -65.2% | -25.4% |
| Time to Full Recovery | Not Fully Recovered | 464 days |
2020 Covid Pandemic
- ALB stock fell 46.0% from a high of $94.31 on 20 February 2020 to $50.90 on 23 March 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 1 September 2020
| ALB | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -46.0% | -33.9% |
| Time to Full Recovery | 162 days | 148 days |
2018 Correction
- ALB stock fell 59.0% from a high of $144.58 on 8 November 2017 to $59.30 on 27 August 2019 vs. a peak-to-trough decline of 19.8% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 22 December 2020
| ALB | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -59.0% | -19.8% |
| Time to Full Recovery | 483 days | 120 days |
2008 Global Financial Crisis
- ALB stock fell 66.9% from a high of $47.76 on 31 October 2007 to $15.81 on 5 March 2009 vs. a peak-to-trough decline of 56.8% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 5 October 2010
| ALB | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -66.9% | -56.8% |
| Time to Full Recovery | 579 days | 1480 days |
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