Albemarle (ALB) Stock Forecast & Price Target

Albemarle's positive outlook is largely supported by the strong growth in electric vehicle (EV) sales, which increased 30% year-over-year in June and 22% in the first half of 2025 across Europe, signaling heightened demand for lithium used in battery production. The company's fully integrated operation, which includes robust upstream resources in salt brine deposits and joint ventures in hard rock mining, positions it advantageously to meet the escalating global demand for lithium amidst significant sales increases in key markets. Additionally, the soaring EV sales reported by major automakers, such as Volkswagen Group's 90% growth in sales within Europe, further underscores the expanding market for lithium-ion batteries, which will likely bolster Albemarle's financial performance.

The outlook on Albemarle's stock appears negative primarily due to a significant reduction in expected long-term agreements (LTAs), with only about 45% of FY25 lithium volumes anticipated to be secured under these contracts. Furthermore, a deceleration in electric vehicle (EV) sales growth in China, now projected at 15% year-over-year, could result in an overall decrease in year-to-date sales growth to 30%, down from 33% in the first half of FY25. Compounding these challenges, both elevated inventory levels and the potential decline in spodumene feedstock prices, which are lagging in reaction to the already softened Chinese spot prices, suggest further headwinds for Albemarle's financial performance in the near term.