LyondellBasell faces stock decline amid dividend cut concerns
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Aug 04 2024
0mins
Source: Coinmarketcap
LyondellBasell Industries N.V. has seen its stock price drop by 4.13%, hitting a 20-day low, as investors react to broader market conditions.
Despite the S&P 500 and Nasdaq-100 showing gains of 1.64% and 2.84% respectively, LyondellBasell's stock is under pressure following a recent dividend cut, which has raised concerns among investors about its financial stability. Analysts, however, remain optimistic about the company's long-term growth potential, projecting significant increases in sales and earnings per share for 2026.
The current market volatility, driven by geopolitical tensions and inflation, highlights the importance of stock selection. While LyondellBasell's recent performance has been disappointing, its anticipated growth could provide a rebound opportunity for investors in the future.
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Analyst Views on LYB
Wall Street analysts forecast LYB stock price to fall
15 Analyst Rating
1 Buy
11 Hold
3 Sell
Hold
Current: 61.810
Low
36.00
Averages
47.29
High
57.00
Current: 61.810
Low
36.00
Averages
47.29
High
57.00
About LYB
LyondellBasell Industries N.V. is an independent chemical company creating solutions for everyday sustainable living. The Company's segments include Olefins and Polyolefins-Americas (O&P-Americas), Intermediates and Derivatives (I&D), Advanced Polymer Solutions (APS), and Technology. The O&P-Americas segment produces and markets olefins and co-products, polyethylene, and polypropylene. The I&D segment produces and markets propylene oxide (PO) and its derivatives, oxyfuels and related products, and intermediate chemicals, such as styrene monomer (SM), and acetyls. The APS segment produces and markets compounding and solutions, such as polypropylene compounds, engineered plastics, masterbatches, engineered composites, and colors. The Technology segment develops and licenses chemical and polyolefin process technologies and manufactures and sells polyolefin catalysts.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- LyondellBasell Performance Outlook: LyondellBasell anticipates a 12% and 414% year-over-year growth in sales and EPS for 2026, respectively, with EPS estimates raised by $4.11 over the past 60 days, reflecting its strong market position and cost advantages that will support shareholder returns in the future.
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- Sector Performance Divergence: Since early April, sectors such as Energy, Tech, Basic Materials, Industrials, Utilities, and Business Services have seen upward revisions in earnings expectations, particularly driven by the strong recovery potential in Energy and Tech sectors.
- Notable Stock Performance: Q2 EPS estimates for Dow (DOW) and LyondellBasell (LYB) have more than doubled in the past month, while Methanex (MEOH) has seen an increase of over 30%, showcasing robust performance amid current market conditions.
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- Market Environment Analysis: Investors are navigating a landscape marked by geopolitical tensions in the Middle East and high inflation, leading to increased market volatility and underscoring the importance of stock selection, particularly under a value investing strategy that focuses on companies with fundamentals not fully reflected in their stock prices.
- LyondellBasell Performance Outlook: LyondellBasell anticipates a 12% and 414% year-over-year growth in sales and EPS for 2026, respectively, with EPS estimates raised by $4.11 over the past 60 days, reflecting its strong market position and cost advantages that will support shareholder returns in the future.
- Star Bulk Growth Potential: Star Bulk expects a 30% and 313% growth in sales and EPS for 2026, respectively, with its low-cost structure and fleet modernization enhancing earnings power, while management's optimistic outlook on future market conditions will further drive shareholder value creation.
- Cenovus Energy Strategy: Cenovus forecasts a 7% and 105% growth in sales and EPS for 2026, respectively, bolstered by the acquisition of MEG Energy and multiple growth projects that enhance its oil sands portfolio, leading to higher output and cash flows, thereby improving profitability in the years ahead.
See More
Investment Opportunities After Dividend Cuts
- Dividend Cut Impact: Morgan Stanley highlights that while dividend cuts may lead to short-term stock price declines, stocks often rebound after initial reactions, particularly when companies improve their financial positions.
- Healthcare Realty Trust Performance: This real estate investment trust cut its dividend by 23% over the past year, yet its stock has risen 20% in 2026, with a current dividend yield of 4.7%, indicating management's execution is exceeding expectations.
- Dow Inc. Adjustment: After halving its dividend to 35 cents per share last July, Dow's stock has surged 42% in 2026, maintaining a 4.2% dividend yield, with the CEO stating this adjustment provides greater financial flexibility for high-return opportunities.
- Market Analyst Trends: Morgan Stanley's report reveals that despite dividend cuts from companies like LyondellBasell and DuPont, analysts remain optimistic about Dow, with nine analysts rating it as a buy or strong buy.
See More
Positive Revisions Trend in Q1 Earnings Reports
- Earnings Revision Trend: Zacks Director of Research Sheraz Mian highlights that despite a modest decline in Q2 earnings estimates, the overall revision trend remains positive, indicating market confidence in future profitability.
- Sector Performance Disparity: Since early April, sectors such as Energy, Tech, Basic Materials, Industrials, Utilities, and Business Services have seen upward revisions in earnings estimates, particularly in Energy and Tech, reflecting optimistic sentiment in these areas.
- Outstanding Individual Stocks: For instance, Dow (DOW) and LyondellBasell (LYB) have seen their Q2 EPS estimates double over the past month, while Methanex (MEOH) has increased by over 30%, showcasing strong performance in the current market environment.
- Negative Pressure Sectors: In contrast, sectors like Transportation, Autos, Medical, and Consumer Discretionary are facing renewed pressure on Q2 estimates, suggesting a cautious outlook that could impact stock performance in these areas.
See More
Positive Earnings Outlook for Q2 2026
- Strong Earnings Outlook: The overall earnings picture continues to improve, with positive revisions for Q2 2026 indicating enhanced market confidence, even as recent estimates have slightly declined, reflecting a resilient economic backdrop.
- Sector Performance Divergence: Since early April, sectors such as Energy, Tech, Basic Materials, Industrials, Utilities, and Business Services have seen upward revisions, particularly in Energy and Tech, highlighting a robust recovery in these areas.
- Notable Individual Stocks: EPS estimates for Dow (DOW) and LyondellBasell (LYB) have more than doubled in the past month, while Methanex (MEOH) has seen an increase of over 30%, indicating significant improvements in their earnings capabilities.
- Negative Pressure Emerging: Despite strong performances in certain sectors, Q2 estimates for Transportation, Autos, Medical, and Consumer Discretionary have faced renewed pressure since the beginning of the period, indicating ongoing market divergence and uncertainty.
See More
Positive Earnings Outlook for Q2 2026
- Strong Earnings Outlook: The overall earnings picture continues to improve, with positive revisions for Q2 2026 expectations indicating enhanced market confidence, even though recent estimates have slightly declined, reflecting a resilient economic backdrop.
- Sector Performance Divergence: Since early April, sectors such as Energy, Tech, Basic Materials, Industrials, Utilities, and Business Services have seen upward revisions in earnings expectations, particularly driven by the strong recovery potential in Energy and Tech sectors.
- Notable Stock Performance: Q2 EPS estimates for Dow (DOW) and LyondellBasell (LYB) have more than doubled in the past month, while Methanex (MEOH) has seen an increase of over 30%, showcasing robust performance amid current market conditions.
- Negative Pressure Emerging: Despite strong performances in certain sectors, Q2 estimates for Transportation, Autos, Medical, and Consumer Discretionary have come under renewed pressure since the start of the period, indicating market imbalances and potential risks.
See More
Key Wall Street Ratings Updates for Thursday
- Tesla Robotaxi Expansion: Morgan Stanley reiterates Tesla as equal weight, noting survey checks indicate increased hiring of 'AI Safety Operators' in northern metro areas, suggesting Tesla is gearing up for robotaxi operations expansion, which could enhance future revenues.
- National Health Properties Outlook: Citizens initiates coverage of National Health Properties as outperform, believing the REIT is enhancing organic growth by increasing exposure to Senior Housing Operating Properties, indicating confidence in the senior living market.
- Nvidia Data Center Potential: Bernstein reiterates Nvidia as outperform, highlighting the enormous and still early datacenter opportunity, which is expected to provide significant upside, reflecting optimism in tech stocks.
- Quanta Services Rating Upgrade: Oppenheimer upgrades Quanta Services from perform to outperform with an $800 price target, indicating strong growth potential in the coming years, particularly in adjusted EBITDA expectations.
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