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What Are Analysts Signaling with LyondellBasell?

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The analyst consensus on LyondellBasell

As of December 7, 2017, 24 analysts are actively tracking LyondellBasell (LYB). Among these analysts, 29% recommend a “buy,” while 63% recommend a “hold,” and 8% recommend a “sell” for the stock.

The analyst consensus projects that LyondellBasell’s mean target price is $104.80, but the stock closed 1.6% above that target price on December 7, 2017. In the past three months, the analysts’ mean target price for LYB has shown an upward trend, from $95.90 to its current target price of $104.80.

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What most analysts say

LyondellBasell had mixed 3Q17 earnings results, with revenues beating the analysts’ estimates but earnings per share failing to meet the analysts’ expectations.

Meanwhile, LYB has agreed to acquire a 50% stake in Quality Circular Polymers, and it’s been winning new clients. This new investment decision—to build world’s largest propylene oxide and tertiary butyl alcohol plant in Houston area for the future growth—is seen as a positive business development that could fuel LYB’s future growth.

At the same time, LYB’s new share repurchase program, which was approved in May, indicates aggressive buybacks that could add value to remaining shareholders. It’s likely for this reason that analysts are recommending a consensus “hold” for LyondellBasell stock.

Individual brokerage views and recommendations

RBC (RY) has recommended a target price of $110 for LYB stock, implying a return potential of 3.3% over its closing price of $106.51 on December 7, 2017.

Barclays (BCS) has recommended a target price of $115 for the stock, implying a return potential of 8.0% over its closing price of $106.51 on December 7, 2017.

Deutsche Bank (DB) has recommended a target price of $105.0. But the stock was already trading 1.4% above the recommended target price on December 7, 2017.

Notably, investors can indirectly hold LyondellBasell by investing in the iBillionaire Index ETF (IBLN), which had 2.7% of its portfolio in LyondellBasell stock on December 7, 2017.

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