Kristin Coleman, an Executive Vice President at Albemarle (ALB), recently bought 1,373 shares. The buy came to a total cost just over $167,000 and doubled the executive’s stake.
That’s the first insider activity since May, when a division president bought 1,260 shares, paying just over $246,000. Going further back, company insiders were sellers in the high $200 to low $300 range, and were buyers in early 2022 the last time shares were trading under $200.
Overall, Albemarle insiders own 0.2 percent of shares.
The lithium producer is down over 62 percent in the last year. Sales of lithium-heavy electric vehicles have slowed, reducing demand in the short-term.
Earnings are off of last year’s highs by nearly 66 percent, but Albemarle is still showing revenue growth of 11 percent.
Action to take: The drop in shares has taken Albemarle’s valuation to under 7 times forward earnings, a reasonable price for a commodity-based business. Continued EV production and sales will likely push lithium demand higher in the years ahead.
At current prices, shares also pay a 1.3 percent dividend. Investors should wait for the current downtrend to end before buying.
For traders, the trend is still down. The March 2024 $100 puts, last going for about $7.10, could see mid-to-high double-digit gains. Traders may want to look for a quick profit from a continued decline here in the coming weeks.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.