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Should You Buy Albemarle Corporation (ALB) Stock Friday?

Friday, January 07, 2022 01:36 PM | InvestorsObserver Analysts
Should You Buy Albemarle Corporation (ALB) Stock Friday?

InvestorsObserver gives Albemarle Corporation (ALB) a strong valuation score of 61 from its analysis. The proprietary scoring system considers the underlying health of a company by analyzing its stock price, earnings, and growth rate. ALB currently holds a better value than 61% of stocks based on these metrics. Long term investors focused on buying-and-holding should find the valuation ranking system most relevant when making investment decisions.

Valuation Rank - 61
ALB gets a 61 Valuation Rank today. Find out what this means to you and get the rest of the rankings on ALB!

Metrics Analysis

ALB's trailing-12-month Price to Earnings (PE) ratio of 123.5 puts it above the historical average of roughly 15. ALB is a poor value at its current trading price as investors are paying more than what its worth in relation to the company's earnings. ALB's trailing-12-month earnings per share (EPS) of 1.89 does not justify what it is currently trading at in the market. Trailing PE ratios, however, do not factor in a company's projected growth rate, resulting in some firms having high PE ratios due to high growth potentially enticing investors even if current earnings are low. ALB currently has a 12-month-forward-PE-to-Growth (PEG) ratio of 1.85. The market is currently overvaluing ALB in relation to its projected growth due to the PEG ratio being above the fair market value of 1. ALB's PEG comes from its forward price to earnings ratio being divided by its growth rate. Because PEG ratios include more fundamentals of a company's overall health with additional focus on the future, they are one of the most used valuation metrics by analysts.

Summary

All together these valuation metrics paint a pretty poor picture for ALB at its current price due to a overvalued PEG ratio despite strong growth. The PE and PEG for ALB are worse than the average of the market resulting in a valuation score of 61. Click Here to get the full Report on Albemarle Corporation (ALB) stock.

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