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LyondellBasell (LYB)
NYSE:LYB
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LyondellBasell
(NYSE:LYB)
58Neutral
Positive Factors
Capacity Reduction
LYB is fairly confident on price and margin improvement with approximately 5% of industry capacity coming offline.
Cash Flow
Free cash flow remains strong, comfortably covering dividends and capital expenditures, making LYB a standout compared to peers in the current macro environment.
Valuation
The analyst reiterates an overweight rating on LYB due to stock underperformance and attractive valuation with significant upside potential in a recovery to mid-cycle dynamics.
Negative Factors
Dividend Coverage
Cash flow is under pressure with higher capital expenditure, and LYB is not covering its dividend.
Earnings Pressure
LYB's earnings are pressured by higher costs and continued new global supply.
Market Oversupply
Polyethylene and polypropylene markets are seen as oversupplied, potentially taking years to rebalance.
LyondellBasell (LYB) vs. S&P 500 (SPY)
Market Cap
$19.19B
Dividend Yield9.05%
Average Volume (3M)4.60M
Price to Earnings (P/E)14.3
Beta (1Y)0.78
Revenue Growth-1.46%
EPS Growth-36.00%
CountryUS
Employees20,000
SectorBasic Materials
Sector Strength59
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)4.14
Shares Outstanding322,837,430
10 Day Avg. Volume4,486,527
30 Day Avg. Volume4,596,028
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.57
Price to Cash Flow (P/CF)3.00
P/FCF Ratio3.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$68.87Price Target Upside15.86% Upside
Rating ConsensusHold
Number of Analyst Covering16
LyondellBasell Business Overview & Revenue Model
Company DescriptionLyondellBasell Industries N.V. is a leading global chemical company operating in the manufacturing of plastics, chemicals, and refining sectors. The company's core products include polyethylene and polypropylene, which are used in a wide range of applications across industries such as packaging, automotive, and construction. LyondellBasell also produces advanced polymers, fuels, and refining products, playing a crucial role in the global supply chain for various industrial and consumer applications.
How the Company Makes MoneyLyondellBasell makes money primarily through the production and sale of chemical and plastic products. Its revenue model is centered around three main business segments: Olefins and Polyolefins, Intermediates and Derivatives, and Refining. Olefins and Polyolefins is the largest segment, generating revenue from the sale of basic chemicals and plastic resins like polyethylene and polypropylene. The Intermediates and Derivatives segment contributes through the production of propylene oxide and its derivatives, acetyls, and other chemicals that are key ingredients in numerous industrial processes. The Refining segment adds to the company's earnings by processing crude oil into refined products, such as gasoline and diesel. LyondellBasell's diverse portfolio and strategic partnerships with key industry players enhance its market presence and contribute significantly to its profitability.
LyondellBasell Financial Statement Overview
Summary
LyondellBasell faces significant financial challenges across key areas. The income statement reflects profitability issues with negative gross profit and declining revenue. The balance sheet shows moderate stability but cautionary signs regarding equity levels. Cash flow analysis indicates resilience in operational cash generation, but overall cash flow stability remains a concern due to volatility.Income Statement
LyondellBasell's income statement reveals significant challenges, with gross profit turning negative in the latest year, indicating potential cost control issues. Revenue has declined sharply from previous years, coupled with decreasing net income and margins. The negative trajectory in revenue and profit margins reflects instability and profitability concerns in its operations.45
Neutral
Balance Sheet
The balance sheet shows a moderate level of stability with a reasonable debt-to-equity ratio. However, the decline in stockholders' equity in recent years raises concerns about the company's financial foundation. Although total assets have remained relatively stable, the equity ratio has improved, indicating a cautious but positive aspect of its financial position.60
Neutral
Cash Flow
Cash flow analysis indicates some resilience, with steady operating cash flow. However, the free cash flow growth has been volatile, and the latest figures show a decline. The capability to generate cash relative to net income remains consistent, but overall cash flow stability is a concern.55
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 40.30B | 41.11B | 50.45B | 46.17B | 27.75B | Gross Profit |
| 4.56B | 5.26B | 6.60B | 8.78B | 3.39B | EBIT |
| 1.82B | 3.05B | 5.10B | 6.77B | 2.49B | EBITDA |
| 3.61B | 4.64B | 6.10B | 8.94B | 3.61B | Net Income Common Stockholders |
| 1.36B | 2.11B | 3.88B | 5.61B | 1.42B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 3.38B | 3.39B | 2.15B | 1.48B | 2.46B | Total Assets |
| 35.75B | 37.00B | 36.37B | 36.74B | 35.40B | Total Debt |
| 12.45B | 13.00B | 13.18B | 13.60B | 17.49B | Net Debt |
| 12.45B | 9.61B | 11.02B | 12.13B | 15.73B | Total Liabilities |
| 23.16B | 23.94B | 23.74B | 24.87B | 27.41B | Stockholders Equity |
| 12.46B | 12.93B | 12.62B | 11.86B | 7.97B |
| Cash Flow | Free Cash Flow | |||
| 3.82B | 3.41B | 4.23B | 5.74B | 1.46B | Operating Cash Flow |
| 3.82B | 4.94B | 6.12B | 7.70B | 3.40B | Investing Cash Flow |
| -1.85B | -1.78B | -1.98B | -1.50B | -4.91B | Financing Cash Flow |
| -1.90B | -1.95B | -3.41B | -6.38B | 2.27B |
LyondellBasell Technical Analysis
Negative
59.44
Price Trends
68.49
Negative
71.64
Negative
80.44
Negative
Market Momentum
-3.22
Negative
43.49
Neutral
69.82
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LYB, the sentiment is Negative. The current price of 59.44 is below the 20-day moving average (MA) of 60.03, below the 50-day MA of 68.49, and below the 200-day MA of 80.44, indicating a bearish trend. The MACD of -3.22 indicates Negative momentum. The RSI at 43.49 is Neutral, neither overbought nor oversold. The STOCH value of 69.82 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LYB.
LyondellBasell Risk Analysis
LyondellBasell disclosed 28 risk factors in its most recent earnings report. LyondellBasell reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
LyondellBasell Peers Comparison
Overall Rating
UnderperformOutperform
Sector (49)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $8.76B | 10.53 | 16.11% | 4.06% | 1.91% | 2.94% | |
67 Neutral | $23.28B | 17.46 | 19.13% | 2.58% | -4.59% | 11.09% | |
67 Neutral | $24.65B | 35.23 | 3.12% | 2.35% | 2.64% | 80.37% | |
65 Neutral | $12.00B | 20.44 | 5.76% | 2.19% | -3.24% | 24.29% | |
60 Neutral | $8.81B | 12.41 | 12.69% | ― | -2.64% | 120.05% | |
58 Neutral | $19.19B | 14.27 | 10.69% | 9.05% | -1.46% | -36.00% | |
49 Neutral | $1.95B | -1.50 | -22.00% | 3.79% | 0.66% | -27.40% |
* Basic Materials Sector Average
Performance Comparison
LYB
LyondellBasell
59.44
-36.25
-37.88%
EMN
Eastman Chemical
75.84
-18.27
-19.41%
PPG
PPG Industries
102.57
-25.35
-19.82%
WLK
Westlake Chemical
93.39
-55.27
-37.18%
DD
DuPont de Nemours
65.69
-6.83
-9.42%
AVTR
Avantor
12.93
-11.15
-46.30%
LyondellBasell Earnings Call Summary
Earnings Call Date: Apr 25, 2025 | % Change Since: 0.32% | Next Earnings Date: Aug 1, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook. While there were notable achievements in cost reduction, safety performance, and strategic project milestones, these were counterbalanced by significant impacts from market volatility, trade challenges, and operational downtimes. The company remains confident in its strategy to emerge stronger from the downturn, but current conditions present challenges that temper this optimism.Highlights
Record Safety Performance
LyondellBasell achieved a March year-to-date total recordable incident rate of 0.12, improving on its very low rates from 2023 and 2024.
Portfolio Management Reduces Costs
The portfolio management activities since 2023 have reduced annual fixed cost expenditures by approximately $300 million net of onetime costs.
Cash Improvement and Cost Reduction Plans
In response to the current market environment, LyondellBasell launched a $500 million cash improvement plan for 2025, including a $100 million reduction in capital expenditures and $200 million in fixed cost savings.
Flex-2 Project Milestone
The Flex-2 project reached a final investment decision milestone, with an expected EBITDA benefit of approximately $150 million per year post-startup and a strong IRR in the mid-teens.
Strong Cash Conversion
LyondellBasell converted EBITDA into cash at a rate of 87% over the past 12 months, above its long-term target of 80%.
Lowlights
Significant Turnaround Impact
First quarter profitability was impacted by a significant turnaround of the Channelview complex and planned and unplanned downtime, reducing EBITDA by $200 million.
Challenging European Market
Despite improved cracker utilization, European market outlook remains uncertain due to potential impacts from trade volatility and low economic indicators.
Weak Demand in China
Continued weakness in China due to low demand, high inventories, and a sluggish housing market, along with reduced licensing sales indicating a slowdown in new polyethylene capacity projects.
Tariff and Trade Volatility
Increased trade policy volatility is expected to shift trade flows and result in near-term trade disruptions, particularly affecting U.S. polyethylene exports.
Company Guidance
During the LyondellBasell teleconference, management provided guidance on several key metrics for 2025, emphasizing strategic cost management and growth initiatives amidst challenging market conditions. The company aims to unlock $1 billion in recurring annual EBITDA by the end of the year, with $50 million coming from fixed cost reductions. Additional fixed cost savings of at least $200 million are targeted as part of a $500 million cash improvement plan, which also includes a $100 million reduction in capital expenditures and a $200 million reduction in working capital targets. The plan involves optimizing operations and enhancing cash flow, with strategic projects like Flex-2 and MoReTec-1 prioritized. Despite ongoing market volatility and trade uncertainties, LyondellBasell remains focused on maintaining robust shareholder returns, having returned approximately $500 million to shareholders during the first quarter through dividends and share repurchases.LyondellBasell Corporate Events
Executive/Board Changes
LyondellBasell Announces New Chief Accounting Officer
Neutral
Mar 17, 2025
On March 11, 2025, LyondellBasell Industries N.V. announced the resignation of Chukwuemeka A. Oyolu, their Senior Vice President and Chief Accounting Officer, effective March 24, 2025. Matthew D. Hayes has been appointed to fill the role, bringing extensive experience from within the company and previous roles at Halliburton. This leadership change is expected to maintain the company’s robust financial management and reporting standards.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.