Analysts at Berenberg Bank upgraded Albemarle Corporation (NYSE:ALB) to buy from sell, raising their price target to $280 from $115.

According to the analysts, they have conducted a detailed bottom-up supply-demand analysis of the lithium market and raised their long-term forecast for lithium prices to USD15,000/ton, which will be beneficial for the company. The analysts believe Albemarle is well-positioned to deliver fast earnings growth supported by ideally timed capacity expansions.

According to the brokerage the company has the best assets to compete in the structurally tight and high-growth lithium market and is set for hefty capacity upgrades at lower costs than peers.

Berenberg Bank anticipates the company to become strongly FCF- positive from 2023E, with growth in both lithium prices and volumes boosting the company’s EBITDA to USD3.5 billion by 2030E and expand its lithium division EBITDA margins from the current 36% to 42%.