Should You Sell Albemarle Corporation (ALB)?

The London Company, an investment management company, released “The London Company Large Cap Strategy” second quarter 2024 investor letter. A copy of the letter can be downloaded here. The US stocks’ performance was mixed in the second quarter measured by the Russell 3000 Index’s 3.2% return.  The fund declined 1.9% (2.0% net) during the quarter compared to a 3.6% return for the Russell 1000 Index. For more information on the fund’s top picks in 2024, please check its top five holdings.

The London Company Large Cap Strategy highlighted stocks like Albemarle Corporation (NYSE:ALB), in the second quarter 2024 investor letter. Albemarle Corporation (NYSE:ALB) develops, manufactures, and markets engineered specialty chemicals. One-month return of Albemarle Corporation (NYSE:ALB) was -11.55%, and its shares lost 56.52% of their value over the last 52 weeks. On August 2, 2024, Albemarle Corporation (NYSE:ALB) stock closed at $86.99 per share with a market capitalization of $10.224 billion.

The London Company Large Cap Strategy stated the following regarding Albemarle Corporation (NYSE:ALB) in its Q2 2024 investor letter:

“Exited: Albemarle Corporation (NYSE:ALB) – Sold our remaining position in ALB after the stock triggered our soft stop loss review. We are concerned that weaker demand in the US for electric vehicles coupled with greater than expected supply of lithium reaching the market may lead to declining lithium prices. This will likely lead to lower cash flow generation in the years ahead, which weakens the downside protection case for the stock.”

A team of scientists in a laboratory observing the sophisticated engineering of specialty chemicals.

Albemarle Corporation (NYSE:ALB) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 39 hedge fund portfolios held Albemarle Corporation (NYSE:ALB) at the end of the first quarter which was 27 in the previous quarter. Albemarle Corporation’s (NYSE:ALB) net sales in the second quarter of 2024 were $1.4 billion compared to $2.4 billion in Q2 2024, a 40% decrease mostly due to decreased pricing. While we acknowledge the potential of Albemarle Corporation (NYSE:ALB) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

In another article, we discussed Albemarle Corporation (NYSE:ALB) and shared the list of best lithium and battery stocks to buy. In addition, please check out our hedge fund investor letters Q2 2024 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.