LSB Industries Story

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LXU -- USA Stock  

USD 3.71  0.16  4.51%

As many millenniums are excited about basic materials space, it is only fair to review LSB Industries. We will try to explain if it is still possible for LSB Industries to generate above-average margins. Is the firm valuation sustainable? Here I will cover a perspective on valuation of LSB Industries to give you a better outlook on taking a position in this stock.
Published over two weeks ago
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Is LSB Industries (NYSE:LXU) ready for a correction?
LSB Industries has 512.22 M in debt with debt to equity (D/E) ratio of 1.15, which is OK given its current industry classification. The entity has a current ratio of 1.38, which is typical for the industry and considered as normal. We provide trade recommendation to complement the latest expert consensus on LSB Industries. Our dynamic recommendation engine harnesses a multidimensional algorithm to analyze the entity's potential to grow using all technical and fundamental data available now.
We determine the current worth of LSB Industries using both absolute as well as relative valuation methodologies to arrive at its intrinsic value. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of LSB Industries based exclusively on its fundamental and basic technical indicators. By analyzing LSB Industries's financials, quarterly and monthly indicators, and related drivers such as dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of LSB Industries's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of LSB Industries. We calculate exposure to LSB Industries's market risk, different technical and fundamental indicators, relevant financial multiples and ratios, and then comparing them to LSB Industries's related companies.

LSB Industries Investment Alerts

LSB Industries investment alerts and warnings help investors to get more proficient at understanding not only critical technical and fundamental signals but also the significant portfolio-centered indicators. These indicators include beta, alpha, and other risk-related measures that will help you in monitoring LSB Industries performance across your portfolios.Please check all investment alerts for LSB Industries

LSB Industries Valuation Ratios as Compared to Competition

Our valuation model uses many indicators to compare LSB Industries value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across LSB Industries competition to find correlations between indicators driving the intrinsic value of LSB Industries.

How LSB Industries utilizes its cash?

To perform a cash flow analysis of LSB Industries, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash LSB Industries is receiving and how much cash it distributes out in a given period. The LSB Industries cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities. LSB Industries Net Cash Flow from Operations is comparatively stable at the moment as compared to the past year. LSB Industries reported Net Cash Flow from Operations of 1.89 Million in 2020

Breaking down the case for LSB Industries

The firm reported the last year's revenue of 336.31 M. Reported Net Loss for the year was (104.26 M) with profit before taxes, overhead, and interest of 4.99 M.
 2018 2019 2020 2021 (projected)
Revenues USD378.16 M365.07 M328.56 M398.24 M
Revenues378.16 M365.07 M328.56 M398.24 M

Margins Breakdown

LSB Industries profit margins show the degree to which it makes money. Margin indicators are used not only by investors but also by creditors or LSB Industries itself as indicators of financial health and management effectiveness. Please look more closely at the different varieties of LSB Industries profit margins.
Operating Margin(12.64)
EBITDA Margin0.1
Gross Margin0.0129
Profit Margin(0.25)


LSB Industries Earnings Before Interest Taxes and Depreciation Amortization USD is comparatively stable at the moment. Also, LSB Industries Earnings Before Interest Taxes and Depreciation Amortization EBITDA is decreasing over the last 8 years. The previous year's value of LSB Industries Earnings Before Interest Taxes and Depreciation Amortization EBITDA was 29,208,742.

Another 3 percent gain for LSB Industries

Newest semi variance is at 14.88. As of the 3rd of January, LSB Industries owns the Mean Deviation of 5.12, downside deviation of 4.69, and Market Risk Adjusted Performance of (1.59). In relation to fundamental indicators, the technical analysis model lets you check practical technical drivers of LSB Industries, as well as the relationship between them. Strictly speaking, you can use this information to find out if the firm will indeed mirror its model of historical prices and volume patterns, or the prices will eventually revert. We were able to collect and analyze data for nineteen technical drivers for LSB Industries, which can be compared to its peers in the sector. Please verify LSB Industries market risk adjusted performance, variance, as well as the relationship between the Variance and potential upside to decide if LSB Industries is priced correctly, providing market reflects its prevailing price of 3.39 per share. Given that LSB Industries has jensen alpha of 1.48, we recommend you to check LSB Industries's latest market performance to make sure the company can sustain itself at some point in the future.

Our Final Take On LSB Industries

Whereas some companies within the chemicals industry are still a little expensive, even after the recent corrections, LSB Industries may offer a potential longer-term growth to private investors. To conclude, as of the 3rd of January 2021, our up-to-date 30 days buy-hold-sell advice on the firm is Cautious Hold. We believe LSB Industries is undervalued with below average odds of distress for the next two years.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Achuva Shats do not own shares of LSB Industries. Please refer to our Terms of Use for any information regarding our disclosure principles.

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