Analysts Call For Another Big Year From Albemarle Stock

ALB stock is coming off two monster years

Jan 8, 2018 at 10:03 AM
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Shares of chemical company Albemarle Corporation (NYSE:ALB) had a huge year in 2017, rising nearly 49%. Of course, this outperformance was nothing new for shareholders, who watched ALB stock surge 53.7% back in 2016. This year is shaping up to be no different, with the equity jumping almost 3% on the first trading day of 2018, and more analysts are starting to take notice.

Just this morning, Citigroup upped its price target to $148 from $142 and Baird raised its price target to $152 from $135, with the latter firm saying it's a buyer ahead of a number of upcoming catalysts. As a result ALB shares have added another 2% to trade at $134.34. While they're still looking up at their Nov. 8 record high of $144.99, the 120-day moving average has again stepped up as support.

If this outperformance continues, it would seem likely more bullish attention could be coming Albemarle's way. For instance, the majority of analysts tracking the stock still have just "hold" ratings in place.

Data also suggests short-term options traders have taken a bearish approach. That's according to the security's Schaeffer's put/call open interest ratio (SOIR) of 1.82, which shows put open interest among options expiring within the next three months almost doubles call open interest. Plus, this reading ranks in the 89th annual percentile, showing such a put-skew has been very rare.

What may be most surprising is the growing interest from short sellers. In the last reporting period alone, short interest jumped nearly 21%, and 6.6% of ALB's total float is dedicated to these bearish bets now. Based on average daily trading volumes, it would take shorts more than seven days to cover their positions -- pointing to ample sideline cash that could come in and push the stock higher.

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