With LyondellBasell Industries Stock Sliding, Have You Assessed The Risk?
LyondellBasell Industries (LYB) stock is down 11.8% in 5 trading days. The recent slide reflects renewed concerns around weak demand for plastics and chemicals and margin pressures, but sharp drops like this often raise a tougher question: is the weakness temporary, or a sign of deeper cracks in the story?
Before judging its downturn reslience, let’s look at where LyondellBasell Industries stands today.
- Size: LyondellBasell Industries is a $14 Bil company with $35 Bil in revenue currently trading at $42.28.
- Fundamentals: Last 12 month revenue growth of -6.3% and operating margin of 4.3%.
- Liquidity: Has Debt to Equity ratio of 0.84 and Cash to Assets ratio of 0.05
- Valuation: LyondellBasell Industries stock is currently trading at P/E multiple of 60.5 and P/EBIT multiple of 27.5
- Has returned (median) 110% within a year following sharp dips since 2010. See LYB Dip Buy Analysis.
These metrics point to a Very Weak operational performance, alongside High valuation – making the stock Very Unattractive. For details, see Buy or Sell LYB Stock
That brings us to the key consideration for investors worried about this fall: how resilient is LYB stock if markets turn south? This is where our downturn resilience framework comes in. Suppose LYB stock falls another 20-30% to $30 – can investors comfortably hold on? Turns out, the stock has fared much worse than the S&P 500 index during various economic downturns, based on (a) how much the stock fell and, (b) how quickly it recovered. Below, we dive deeper into each such downturn.
2022 Inflation Shock
- LYB stock fell 35.7% from a high of $112.30 on 7 June 2022 to $72.20 on 26 September 2022 vs. a peak-to-trough decline of 25.4% for the S&P 500.
- The stock is yet to recover to its pre-Crisis high
- The highest the stock has reached since then is $105.86 on 3 April 2024 , and currently trades at $42.28
| LYB | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -35.7% | -25.4% |
| Time to Full Recovery | Not Fully Recovered | 464 days |
2020 Covid Pandemic
- LYB stock fell 63.1% from a high of $94.48 on 1 January 2020 to $34.90 on 16 March 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 6 January 2021
| LYB | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -63.1% | -33.9% |
| Time to Full Recovery | 296 days | 148 days |
2018 Correction
- LYB stock fell 35.4% from a high of $121.49 on 26 January 2018 to $78.52 on 24 December 2018 vs. a peak-to-trough decline of 19.8% for the S&P 500.
- The stock is yet to recover to its pre-Crisis high
| LYB | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -35.4% | -19.8% |
| Time to Full Recovery | Not Fully Recovered | 120 days |
Feeling jittery about LYB stock? Consider portfolio approach.
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