LYB: Exploring LyondellBasell Industries’s Valuation After Recent Share Price Momentum

LyondellBasell Industries (LYB) shares have moved sideways recently, prompting investors to take a closer look at the underlying trends driving the stock. With mixed returns over the past few months, there is renewed interest in what factors could shape its next direction.

See our latest analysis for LyondellBasell Industries.

After a sharp 7-day share price return of 7.48%, LyondellBasell Industries has shown signs of short-term momentum. However, this comes after a tough stretch, with the 1-year total shareholder return still down 37.89%. The current pace suggests investors are weighing potential for a turnaround against broader long-term pressures on the stock.

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With shares well below analyst targets and key financials sending mixed signals, the question now is whether LyondellBasell Industries is attractively undervalued or if the market has already accounted for any growth ahead.

Most Popular Narrative: 12.6% Undervalued

LyondellBasell Industries closed at $47.01, while the narrative’s consensus puts fair value at $53.78. The gap invites questions about what is truly driving this potential upside, setting the scene for a closer look.

Ongoing portfolio optimization, through discipline in capital allocation, deferred capital projects (like Flex-2), targeted cost reductions, and working capital improvements, is projected to generate at least $1.1 billion incremental cash flow by 2026. This is expected to strengthen free cash flow and support dividends even during downturns.

Read the complete narrative.

Curious what makes this fair value tick? The narrative leans heavily on bold profit growth and higher margins, yet its assumptions might surprise you. Want to know which forecasts are pushing the price higher? This story is more than meets the eye. Click to see the full playbook driving the valuation.

Result: Fair Value of $53.78 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, a prolonged industry downturn or delays in key projects could quickly shift the outlook and pose real challenges to the valuation story ahead.

Find out about the key risks to this LyondellBasell Industries narrative.

Build Your Own LyondellBasell Industries Narrative

If this perspective isn't quite your own or you want to dive deeper, you can explore the numbers and shape your own personal narrative in just a few minutes by using Do it your way.

A great starting point for your LyondellBasell Industries research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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