LyondellBasell Industries (LYB) continues to draw investor attention after recent share price moves, with the stock last closing at US$71.30 and showing mixed returns over the past week, month and past three months.
See our latest analysis for LyondellBasell Industries.
Recent trading has cooled slightly, with the share price down 3.3% over the past week after a strong 90 day share price return of 28.9%. The 1 year total shareholder return is 37.8%, while the 5 year total shareholder return is slightly negative, so momentum appears more short term than long term.
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With the stock trading at US$71.30, a reported intrinsic value gap of 56% and a 12% discount to analyst targets, are you looking at an undervalued chemical giant, or has the market already priced in future growth?
Most Popular Narrative: 6% Undervalued
The most followed narrative places LyondellBasell Industries' fair value at $75.82, a touch above the recent $71.30 close, and leans heavily on a detailed long term earnings rebuild story.
LyondellBasell's strategic investments in circular and advanced recycling (MoReTec-1 and plans for MoReTec-2, plus expanding renewable feedstock capacity in Europe) position the company to benefit from rising regulatory and consumer demand for recycled and sustainable plastics, improving product mix and supporting higher net margins and long-term revenue growth.
Want to see what underpins that valuation gap? The narrative leans on gradual revenue expansion, a margin rebuild from current losses, and a richer earnings multiple than today.
Result: Fair Value of $75.82 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, this hinges on a recovery that may not materialize if petrochemical demand stays weak or if major projects like Flex 2 and MoReTec 2 face further delays.
Find out about the key risks to this LyondellBasell Industries narrative.
Next Steps
Curious whether the balance of concern and optimism in this story matches your own? Take a closer look at the data and pressure test both sides with the 3 key rewards and 2 important warning signs
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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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