LyondellBasell (LYB) Stock Price Target Cut at Jefferies
NEW YORK (TheStreet) -- LyondellBasell Industries (LYB) - Get Report stock price target was lowered to $84 from $91 at Jefferies on Tuesday morning.
The firm has a "hold" rating on shares of the Houston-based chemical company.
"Brexit has exacerbated concerns over petrochemical demand prospects in 2017-2018, even as the wave of new petrochemical capacity additions ramps up. We believe this could be exacerbated by the emerging market PE demand multiplier proving to be weaker than in the last cycle," Jefferies wrote in an analyst note.
The firm forecasts a 7% free-cash-flow yield for 2016, but by 2017 the "upward creep" in financial leverage could crimp the pace of buybacks.
Additionally, Jefferies believes the risk of an ethane supply bottleneck will increase in the second half of 2017 and 2018 as new petrochemical and export capacity ramp up.
Shares of LyondellBasell closed at $74.69 on Friday.
Separately, TheStreet Ratings Team has a "Buy" rating with a score of B on the stock.
The company's strengths can be seen in multiple areas, such as its notable return on equity and attractive valuation levels.
The team believes its strengths outweigh the fact that the company shows weak operating cash flow.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: LYB