Overview
RBC Capital has increased its 12-month price target on LyondellBasell Industries (NYSE:LYB) to $51.00 from $49.00 while maintaining a Sector Perform rating. The new target is effectively on par with the company’s then-current share price of $51 and sits marginally beneath InvestingPro’s Fair Value assessment, implying the stock may be slightly undervalued relative to that benchmark.
Near-term pressures
RBC analyst Arun Viswanathan expects LyondellBasell to face a difficult first quarter. The firm cites elevated energy costs in both Europe and the United States as a principal headwind, compounded by supply disruptions linked to Winter Storm Fern. Those dynamics are consistent with InvestingPro data that indicate weak gross profit margins of 8.16%.
Updated financial assumptions
Reflecting its view of the near-term operating environment, RBC revised its EBITDA forecasts for LyondellBasell. The new estimates are $620 million for Q1, $3.10 billion for fiscal year 2026, and $3.50 billion for fiscal year 2027. These are downward adjustments from prior assumptions of $676 million for Q1, $3.05 billion for FY26, and $3.48 billion for FY27.
The firm retained a 9.0x FY26 multiple in its methodology for calculating the price target. Alongside the forecast revisions, RBC expressed concern that the company’s dividend could be at risk of a reduction given the current and near-term operating pressures.
Potential tailwinds later in 2026
Despite the short-term headwinds, RBC highlighted factors that could improve LyondellBasell’s trajectory in the back half of 2026. The analyst pointed to rising U.S. polyethylene prices, seasonal influences, and positive price momentum as possible drivers of better performance later in the year.
Other analyst reactions and recent results
LyondellBasell reported a notable earnings shortfall for the fourth quarter of 2025, posting an EPS loss of $0.26 versus an expected loss of $0.20. Revenue for the quarter, however, beat estimates at $7.09 billion compared with a $6.8 billion forecast.
Following those results, Mizuho increased its price target on the company to $53 from $49 while holding a Neutral rating. Goldman Sachs reiterated a Sell rating, citing continuing concerns about the company’s dividend policy. KeyBanc highlighted weaknesses in the Olefins and Polyolefins operating segment and noted the company’s current dividend yield of 11% as a point of concern.
Context and implications
Collectively, the analyst commentary and recent results depict a company navigating a challenging near-term operating environment while leaving open the possibility of recovery later in 2026 if feedstock and product pricing trends prove favorable. The commentary also underscores investor sensitivity to the sustainability of the company’s dividend given the scale of the yield and operating softness in key product segments.
Note: This article presents analyst projections and reported results as stated by the firms and available data; it does not introduce additional forecasts or speculative outcomes beyond those provided.