LyondellBasell (LYB) shares fell 2.3% on Wednesday to close at $92.44 after the company said that it is evaluating options for its Refining Segment based in the Gulf Coast, including a probable sale of the business.
Shares of one of the world’s largest plastics, chemicals, and refining companies have gained 27% over the past year. (See LyondellBasell stock charts on TipRanks)
Spread across 700 acres in the Houston Ship Channel, the Houston Refinery is one of the largest refineries in the U.S., owned by LyondellBasell since 2006.
It has the capacity to convert 268,000 barrels per day of crude oil into high-value transportation fuels, including reformulated gasoline, ultra-low sulfur diesel and jet fuel, and many other products like lubricants, chemical intermediates, and petroleum coke.
LyondellBasell CEO Bob Patel commented, “While the Houston Refinery is a valuable, well-performing asset, we have long held the belief that it may be even more valuable as part of a larger refining system.”
He further added, “To that end, we are actively gauging market interest in this business with the goal of delivering the greatest value to all our stakeholders.”
The company said that there is no certainty regarding the outcome or the timing of the review process.
Deutsche Bank analyst David Begleiter recently reiterated a Hold rating on the stock with the price target of $108 (16.8% upside potential).
Overall, the stock has a Moderate Buy consensus rating based on 4 Buys and 5 Holds. The average LyondellBasell price target of $122.89 implies 33% upside potential from current levels.
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