LyondellBasell Industries (NYSE:LYB) - Share price, News & Analysis

LYB fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	1/6
Past Performance	5/6
Financial Health	4/6
Dividends	5/6

LYB Stock Overview

LyondellBasell Industries N.V. operates as a chemical company in the United States, Germany, Mexico, Italy, Poland, France, Japan, China, the Netherlands, and internationally.

Rewards

Trading at 70.9% below our estimate of its fair value

Earnings grew by 149.3% over the past year

Risk Analysis

Earnings are forecast to decline by an average of 5.9% per year for the next 3 years

Has a high level of debt

Unstable dividend track record

Significant insider selling over the past 3 months

LyondellBasell Industries Competitors

Price History & Performance

Summary of all time highs, changes and price drops for LyondellBasell Industries
Historical stock prices
Current Share Price	US$84.50
52 Week High	US$117.22
52 Week Low	US$83.50
Beta	1.26
1 Month Change	-20.61%
3 Month Change	-21.53%
1 Year Change	-17.54%
3 Year Change	-2.47%
5 Year Change	0.87%
Change since IPO	284.09%

Recent News & Updates

May 20

Why We Just Sold LyondellBasell Industries Stock

LYB has had strong performance momentum lately and is returning a lot of cash to shareholders while also deleveraging that balance sheet. While there is a lot to like about LYB, we want a portfolio of our highest conviction picks. We share why LYB is no longer a high conviction buy for us.

Apr 30

LyondellBasell: Very Strong Start To 2022, But Soft Shareholder Returns

LyondellBasell saw a very strong recovery during 2021, which thankfully continued into 2022. Apart from their operating cash flow surging, their first-quarter earnings are the highest since 2015 with their trailing twelve-month earnings also at the highest level in a decade. Despite this providing immense free cash flow, their shareholder returns have thus far been soft even though management does not plan to deleverage. Thankfully management has reaffirmed nothing has fundamentally changed and thus their shareholder returns should ramp up later in 2022. Since this stands to provide a very high 10% shareholder yield, if not even higher, I believe that maintaining my buy rating is appropriate.

Shareholder Returns

	LYB	US Chemicals	US Market
7D	-7.4%	-0.004%	4.0%
1Y	-17.5%	-11.8%	-20.5%

Return vs Industry: LYB underperformed the US Chemicals industry which returned -10.7% over the past year.

Return vs Market: LYB exceeded the US Market which returned -20.8% over the past year.

Price Volatility

Is LYB's price volatile compared to industry and market?
LYB volatility
LYB Average Weekly Movement	5.3%
Chemicals Industry Average Movement	6.7%
Market Average Movement	7.9%
10% most volatile stocks in US Market	16.5%
10% least volatile stocks in US Market	3.1%

Stable Share Price: LYB is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: LYB's weekly volatility (5%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
2009	19,100	Peter Z. Vanacker	https://www.lyondellbasell.com

LyondellBasell Industries N.V. operates as a chemical company in the United States, Germany, Mexico, Italy, Poland, France, Japan, China, the Netherlands, and internationally. The company operates in six segments: Olefins and Polyolefins—Americas; Olefins and Polyolefins—Europe, Asia, International; Intermediates and Derivatives; Advanced Polymer Solutions; Refining; and Technology. It produces and markets olefins and co-products; polyolefins; polyethylene products, which consist of high density polyethylene, low density polyethylene, and linear low density polyethylene; and polypropylene (PP) products, such as PP homopolymers and copolymers.

LyondellBasell Industries Fundamentals Summary

How do LyondellBasell Industries's earnings and revenue compare to its market cap?
LYB fundamental statistics
Market Cap	US$27.68b
Earnings (TTM)	US$5.85b
Revenue (TTM)	US$50.25b

4.7x

P/E Ratio

0.6x

P/S Ratio

Is LYB overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
LYB income statement (TTM)
Revenue	US$50.25b
Cost of Revenue	US$40.86b
Gross Profit	US$9.39b
Other Expenses	US$3.54b
Earnings	US$5.85b

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	17.86
Gross Margin	18.69%
Net Profit Margin	11.64%
Debt/Equity Ratio	89.4%

How did LYB perform over the long term?

See historical performance and comparison

Dividends

5.6%

Current Dividend Yield

26%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is LYB undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for LYB?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for LYB. This is calculated by dividing LYB's market cap by their current preferred multiple.
What is LYB's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$27.68b

LYB key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	0.8x
Enterprise Value/EBITDA	4.3x
PEG Ratio	-0.8x

Price to Earnings Ratio vs Peers

How does LYB's PE Ratio compare to its peers?

LYB PE Ratio vs Peers

The above table shows the PE ratio for LYB vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	6.7x

Forward PE

Price-To-Earnings vs Peers: LYB is good value based on its Price-To-Earnings Ratio (4.7x) compared to the peer average (6.7x).

Price to Earnings Ratio vs Industry

How does LYB's PE Ratio compare vs other companies in the U.S. Chemicals Industry?

Price-To-Earnings vs Industry: LYB is good value based on its Price-To-Earnings Ratio (4.7x) compared to the US Chemicals industry average (15.4x)

Price to Earnings Ratio vs Fair Ratio

What is LYB's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

LYB PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	4.7x
Fair PE Ratio	14.3x

Price-To-Earnings vs Fair Ratio: LYB is good value based on its Price-To-Earnings Ratio (4.7x) compared to the estimated Fair Price-To-Earnings Ratio (14.3x).

Share Price vs Fair Value

What is the Fair Price of LYB when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: LYB ($84.5) is trading below our estimate of fair value ($290.82)

Significantly Below Fair Value: LYB is trading below fair value by more than 20%.

Price to Earnings Growth Ratio

PEG Ratio: LYB's earnings are forecast to decline next year, so we can't calculate its PEG ratio.

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Future Growth

How is LyondellBasell Industries forecast to perform in the next 1 to 3 years based on estimates from 15 analysts?

Future Growth Score

1/6

Future Growth Score 1/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

-5.9%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: LYB's earnings are forecast to decline over the next 3 years (-5.9% per year).

Earnings vs Market: LYB's earnings are forecast to decline over the next 3 years (-5.9% per year).

High Growth Earnings: LYB's earnings are forecast to decline over the next 3 years.

Revenue vs Market: LYB's revenue is expected to decline over the next 3 years (-6.9% per year).

High Growth Revenue: LYB's revenue is forecast to decline over the next 3 years (-6.9% per year).

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: LYB's Return on Equity is forecast to be high in 3 years time (39.9%)

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Past Performance

How has LyondellBasell Industries performed over the past 5 years?

Past Performance Score

5/6

Past Performance Score 5/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-2.7%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: LYB has high quality earnings.

Growing Profit Margin: LYB's current net profit margins (11.6%) are higher than last year (8%).

Past Earnings Growth Analysis

Earnings Trend: LYB's earnings have declined by 2.7% per year over the past 5 years.

Accelerating Growth: LYB's earnings growth over the past year (149.3%) exceeds its 5-year average (-2.7% per year).

Earnings vs Industry: LYB earnings growth over the past year (149.3%) exceeded the Chemicals industry 30.2%.

Return on Equity

High ROE: LYB's Return on Equity (45.7%) is considered outstanding.

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Financial Health

How is LyondellBasell Industries's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: LYB's short term assets ($13.3B) exceed its short term liabilities ($7.5B).

Long Term Liabilities: LYB's short term assets ($13.3B) do not cover its long term liabilities ($17.5B).

Debt to Equity History and Analysis

Debt Level: LYB's net debt to equity ratio (75.4%) is considered high.

Reducing Debt: LYB's debt to equity ratio has reduced from 138.5% to 89.4% over the past 5 years.

Debt Coverage: LYB's debt is well covered by operating cash flow (75.2%).

Interest Coverage: LYB's interest payments on its debt are well covered by EBIT (16.6x coverage).

Balance Sheet

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Dividend

What is LyondellBasell Industries's current dividend yield, its reliability and sustainability?

Dividend Score

5/6

Dividend Score 5/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

5.63%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: LYB's dividend (5.63%) is higher than the bottom 25% of dividend payers in the US market (1.63%).

High Dividend: LYB's dividend (5.63%) is in the top 25% of dividend payers in the US market (4.34%)

Stability and Growth of Payments

Stable Dividend: LYB's dividend payments have been volatile in the past 10 years.

Growing Dividend: LYB's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (25.7%), LYB's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its low cash payout ratio (23.8%), LYB's dividend payments are well covered by cash flows.

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Management

How experienced are the management team and are they aligned to shareholders interests?

2.7yrs

Average management tenure

CEO

Peter Z. Vanacker (55 yo)

0.083

Tenure

Mr. Peter Z. E. Vanacker is an Executive Director at LyondellBasell Industries N.V. since February 25, 2022. He has been Supervisory Board Member at Symrise AG since June 17, 2020. Mr. Vanacker was Preside...

Leadership Team

Experienced Management: LYB's management team is considered experienced (2.7 years average tenure).

Board Members

Experienced Board: LYB's board of directors are considered experienced (5.3 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: LYB insiders have only sold shares in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/06/23 00:00
End of Day Share Price	2022/06/23 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31