On January 8, BofA analyst Matthew DeYoe reduced the price target for LyondellBasell Industries N.V. (NYSE:LYB) from $52 to $46, maintaining a Neutral rating. The adjustment was part of a routine update to price targets across the chemicals sector covered by the firm, not due to a specific issue at LYB.
BofA expressed a cautious outlook for the sector overall. The firm anticipates another year of oversupply in commodity chemicals. Demand for specialty chemicals remains uneven, and the agricultural sector presents a mixed picture. However, BofA noted potential positive developments on the horizon, including possible improvements in PMI indicators, interest rate cuts, and capacity rationalization in China. The firm views these as encouraging signals but considers it premature to rely on them.
LyondellBasell has been concentrating on factors within its control. In the third quarter of 2025, the company reported improved cash flow and significant fixed cost reductions, despite ongoing challenges in global end markets. Management emphasized portfolio optimization efforts, which involve a pending sale of European assets and the postponement of certain capital projects to conserve cash.
The company recorded a $1.2 billion impairment charge in the quarter, attributed to weaker demand in specific regions and business segments. This charge impacted reported results and affected the quarter's tax situation. Regarding capital allocation, management indicated a move toward a more conservative approach. LyondellBasell lowered its capital expenditure guidance for 2026 to $1.2 billion, while continuing to prioritize shareholder returns and maintain an investment-grade balance sheet.
LyondellBasell Industries N.V. is a leading global producer of plastics, chemicals, and refined fuels. The company also licenses petrochemical technologies and invests in circular economy initiatives, such as recycling-based solutions. The stock is listed among the 13 best dividend stocks paying over 6%.