Albemarle Shares Plunged: What You Need to Know

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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of specialty chemicals maker Albemarle (NYS: ALB) made a batch of green goo and fell as much as 12% in trading today.

So what: Not only is the market stinking it up today, an analyst thinks Albemarle is a bit off. Longbow Research reduced the company to neutral from a buy rating.

Now what: We Fools aren't big fans of Wall Street analysts, but let's look at what they're expecting right now. For the full year, analysts are looking for $4.67 in earnings per share, which puts Albemarle's P/E ratio for 2011 at 10.6. Now, consider that analysts have underestimated earnings for the past four quarters and you have a cheap stock on your hands. I would take this dip as a buying opportunity in a stock that looks to be a great value.

Interested in more info on Albemarle? Add it to your watchlist.

At the time this article was published Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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