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Albemarle (ALB) to Post Q1 Earnings: What's in the Cards?

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Albemarle Corporation (ALB - Free Report) will release first-quarter 2023 results after the closing bell on May 3.

The company beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters. In this timeframe, it delivered an earnings surprise of 15.7%, on average. It posted an earnings surprise of 1.9% in the last reported quarter. The company is likely to have benefited from higher lithium prices and volumes and its cost-reduction actions in the first quarter amid headwinds from higher input costs.

Albemarle’s shares have lost 3.6% over a year compared with an 3.8% decline of the industry it belongs to.

 

Zacks Investment Research
Image Source: Zacks Investment Research

 

Let’s see how things are shaping up for this announcement.

Zacks Model

Our proven model predicts an earnings beat for Albemarle this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earning beat.

Earnings ESP: Earnings ESP for Albemarle is +0.80%. The Zacks Consensus Estimate for the first quarter is currently pegged at $6.93. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Albemarle currently carries a Zacks Rank #3.

What do the Estimates Say?

The Zacks Consensus Estimate for revenues for Albemarle for the to-be-reported quarter stands at $2,737 million, reflecting an increase of around 142.7% from the year-ago quarter.

Some Factors to Watch For

Albemarle is likely to have benefited from higher volumes and prices in its lithium business in the first quarter. Higher lithium prices aided by strong demand are likely to have driven the company’s sales and margins in the quarter.  

The company is also likely to have gained from higher volumes in its lithium business in the March quarter. Higher customer demand, new capacity and plant productivity improvements are expected to have supported volumes. The La Negra III/IV expansion in Chile is also likely to have contributed to volumes.

Benefits of the company’s cost-saving, pricing and productivity initiatives are also expected to get reflected in the quarter to be reported. Its cost and productivity actions are expected to have supported margins in the first quarter.

However, the company’s Ketjen unit is likely to have faced headwinds from higher costs. The business is expected have witnessed challenges from increased input costs as well as higher natural gas costs in Europe due to the Russia-Ukraine war. The segment is likely to have been impacted by raw material cost inflation in the quarter to be reported. The company’s Specialties unit is also likely to have witnessed persistently higher raw material and freight costs.

 

Albemarle Corporation Price and EPS Surprise

 

Albemarle Corporation Price and EPS Surprise

Albemarle Corporation price-eps-surprise | Albemarle Corporation Quote

 

Stocks That Warrant a Look

Here are some companies in the basic materials space you may want to consider, as our model shows these too have the right combination of elements to post an earnings beat this quarter:

DuPont de Nemours, Inc. (DD - Free Report) , slated to release earnings on May 2, has an Earnings ESP of +1.77%. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for DuPont’s earnings for the quarter is pegged at 81 cents. DD currently carries a Zacks Rank #3.

Axalta Coating Systems Ltd. (AXTA - Free Report) , slated to release earnings on May 2, has an Earnings ESP of +4.35%.

The consensus estimate for Axalta Coating Systems’ earnings for the first quarter is currently pegged at 31 cents. AXTA currently carries a Zacks Rank #3.

Pan American Silver Corp. (PAAS - Free Report) , scheduled to release earnings on May 10, has an Earnings ESP of +167.10% and currently carries a Zacks Rank #3.

The Zacks Consensus Estimate for Pan American Silver’s first-quarter earnings has been revised 66.7% upward in the past 60 days. The consensus estimate for PAAS’ earnings for the first quarter is currently pegged at 5 cents.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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