As we get to the tail end of first quarter earnings releases, insiders are now out of their “quiet period” restrictions and we are starting to see a big uptick in insider buying. In fact insider buying nearly doubled last week compared to the week prior.
Weeding through hundreds of companies and their insider purchases for our daily Event Driven Monitor is a time consuming process but it often yields companies with smaller insider purchases that don’t typically show up as part of our Insider Weekends posts. This week we decided to focus on one such company, global specialty chemicals company Albemarle Corp (ALB), which saw two different insiders purchase shares earlier this week but did not make it into our top five insider purchases list.
Albemarle Corp (ALB) $195.79
Albemarle’s stock price had run up by around 97% over the last five years, reaching highs of over $320 before settling down to its current price of $195.79. The reason for this drastic run up has to do with the nature of Albemarle’s business, with a focus on lithium mining and refining. The company was a big beneficiary of the rapid increase in lithium prices since 2021 and the stock was hit recently by the sharp decline in lithium prices over the last year as you can see from the chart below.
Lithium is one of the main components of electric vehicle batteries. The dramatic run-up in lithium prices during the pandemic mirrors the frenzy that many EV stocks saw during the same time. Just like electric vehicle companies like Nikola Corporation (NKLA) and Rivian Automotive (RIVN) eventually saw their stocks come back to earth, lithium prices also began to fall starting in late 2022.