Albemarle (ALB) Stock Forecast & Price Target

Albemarle's stock outlook is positively influenced by the significant growth in electric vehicle (EV) sales, which increased by 30% year-over-year in June and 22% in the first half of 2025 in Europe. Despite North America experiencing a modest growth of 3% in EV sales year-to-date, China and Europe show substantial increases of 33% and 26%, respectively, indicating a robust global trend towards electric vehicle adoption. Additionally, Volkswagen Group's remarkable 90% year-over-year rise in EV sales in Europe further underscores the increasing demand for lithium, enhancing Albemarle's position as a leading lithium producer that can capitalize on these market dynamics.

Albemarle's outlook is negatively influenced by a projected reduction in long-term agreements (LTAs), as approximately 45% of FY25 lithium volumes are now expected to be sold under LTAs, down from previous expectations, highlighting a shift towards more volatile sales in the Chinese market. Additionally, the July forecast indicates a slowdown in year-over-year growth for electric vehicle (EV) sales in China to 15%, leading to an anticipated decline in year-to-date sales growth to 30%, compared to 33% in the first half of 2025. Furthermore, spot prices for lithium in China may have stabilized, but prices outside of China remain at a premium, raising concerns about potential price declines in the coming months amid increasing EV inventories and a projected decrease in spodumene feedstock prices.