Quick Take: Albemarle

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Tom Konrad, Ph.D., CFA

Albemarle Corp. (NYSE:ALB) has come up twice in recent conversations with investment advisors in the last couple weeks.  I’m not sure why the recent surge of interest, but I thought I’d share my email in response to the most recent query.

An investment advisor friend:

Any thoughts [on Albemarle]?  A mining company corners about 35% of the raw material for the manufacture of lithium batteries for electric cars.

My response:

I like it better than most Lithium plays, because they are vertically integrated.  That said, I don’t like Lithium plays in general… seems similar to the whole rare earth thing.  It’s likely to be a big boom and bust commodity cycle.
Second, I just don’t like mining.

On a valuation basis, ALB seems fairly valued, which means not nearly cheap enough for me.  I also dislike the high beta.

If you want to invest in cleaner transportation, my current top pick is MIXT.

Was that useful?  Let us know in the comments, or if you have more in-depth thoughs on Albemarle.

Disclosure: Long MIXT.

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