Albemarle Corporation

Methodology

Albemarle's lithium production is highly cyclical with extreme earnings volatility from EV adoption rates and lithium pricing. During booms earnings surge dramatically; during supply gluts they collapse. This calculation is problematic unless using normalized mid-cycle lithium prices, as spot pricing creates misleading projections.

Methodology

Albemarle's PEG swings wildly with lithium cycles, often appearing cheap at peak earnings when growth is highest but unsustainable. Long-term EV-driven growth is real, but near-term volatility makes PEG unreliable for timing. Better to assess valuation based on long-term lithium demand scenarios and cost position rather than extrapolating recent trends.

Methodology

Albemarle's modest dividend is secondary to commodity-driven growth story. The company maintains dividends through cycles, but yield provides minimal downside protection during price crashes. PEGY offers little insight for investors focused on lithium market fundamentals, capacity expansion, and EV adoption rather than income.