What happened

Shares of Albemarle (ALB 2.09%) jumped over 11% today after the company reported solid full-year 2018 operating results. The business delivered total revenue growth of 14% in the final quarter of last year compared to the year-ago period, while lithium sales jumped 9% in 2018 compared to 2017. 

The momentum is projected to carry into this year. Albemarle expects full-year 2019 revenue growth of 8% to 14% compared to last year. And adjusted EBITDA is expected to jump 6% to 13%. The growth will be underpinned by volume increases from the lithium segment, which will begin receiving contributions from the company's Wave 1 expansion initiative.

As of 11:52 a.m. EST, the stock had settled to a 5.5% gain.

A hand placing a block on a stack of blocks with an upward arrow on their faces.

Image source: Getty Images.

So what

Many investors think of Albemarle as a lithium production business. That's not entirely misplaced, as its lithium segment -- the largest on the planet -- comprised 47.5% of total segment-adjusted EBITDA. But each of the company's three segments represents about one-third of total sales.

That suggests investors shouldn't overlook the "other" two segments: bromine specialties and catalysts. The bromine segment posted year-over-year revenue growth of 7%, while the catalyst segment delivered sales growth of just 3% last year. Although Albemarle projects both segments will be "stable" in 2019, the catalysts unit should soon receive a boost from a new global rule requiring low-sulfur fuels to be used in marine applications.

Producing cleaner fuels, such as low-sulfur diesel, requires special catalysts such as those supplied by Albemarle. With global diesel demand expected to jump by at least 12 billion gallons per year once the rule takes effect in 2020, investors can't overlook the potential opportunity for the company.

Check out the latest Albemarle earnings call transcript.

Now what

Investors have been on a roller-coaster ride with Albemarle stock in recent years. It shot up to a frothy premium on the heels of (excessive) excitement about the growth potential of lithium through 2017, then fell back to earth in 2018. Shares may have fallen a little too far, however, as it didn't take much digging to conclude that the stock was undervalued relative to future growth. Today's double-digit eruption is simply a sign Mr. Market now realizes his mistake.