Dow and LyondellBasell upgraded at Credit Suisse as 2023 seen as a trough year for earnings By


© Reuters. Dow and LyondellBasell upgraded at Credit Suisse as 2023 seen as a trough year for earnings

By Sam Boughedda

Credit Suisse upgraded shares of Dow (NYSE:) and LyondellBasell Industries (NYSE:) to Outperform on Monday, with analysts telling investors that “the tide is changing.”

They assumed coverage of Dow and also increased the firm’s price target on the stock to $68 per share.

The firm expects 2023 to be a trough year for earnings “as the pricing/margin headwind from new capacity in several derivatives (polyethylene [PE], methylene diphenyl isocyanate [MDI]) dissipates.”

“While we remain concerned that demand may surprise to the downside in 2023 (we remain below consensus), we believe the risk/reward of higher demand for several of DOW’s commodities is skewed favorably in 2024+,” analysts write.

They also lifted the firm’s price target on LYB to $109 per share, stating that similar to their forecast for DOW, they expect 2023 to represent a near-term trough for earnings for LYB due to weaker polyethylene earnings.

“Recently constructed capacity (propylene oxide) could offer upside if a commodity price recovery happens quicker than expected,” the analysts said. “Like our estimates for DOW, our forecasts for LYB remain below consensus given our concern that demand and integrated polyethylene margins could surprise to the downside. However, we believe that investors will continue to ascribe a higher multiple to LYB given trough earnings in 2023.”

Overall, the firm believes the domestic polyethylene market will likely reach trough conditions in 2023, but they expect investors to look optimistically to 2024 and further ahead while they also see the recent capacity wave for commodities (polyethylene, MDI) to be a “headwind for pricing in 2023.”


Source link


Jacob Keiter is a husband, a writer, a journalist, a musician, and a business owner. His journey to becoming a writer was one that was paved with challenges, but ultimately led him to find his true calling. Jacob's early years were marked by a strong desire for creative expression. He was always drawn to music, and in his youth, he played in several bands, chasing the elusive promise of fame and success. However, despite his best efforts, Jacob struggled to find the recognition he craved. It wasn't until he hit a low point in his life that Jacob discovered his love for writing. He turned to writing as a form of therapy during a particularly difficult time, and found that it not only helped him to cope with his struggles, but also allowed him to express himself in a way that he had never been able to before. Jacob's writing skills quickly caught the attention of others, and he soon found himself working as a journalist for The Sun out of Hummelstown. From there, he went on to contribute to a variety of publications, including the American Bee Journal and Referee Magazine. Jacob's writing style is reflective of traditional journalism, but he also infuses his work with a unique voice that sets him apart from others in his field. Despite his success as a writer, Jacob also owns another business, JJ Auto & Home, which specializes in cleaning. Jacob's commitment to excellence is evident in all of his endeavors, whether it be in his writing or in his business ventures. Today, Jacob is the author of two books and continues to inspire others through his writing. His journey to becoming a writer serves as a reminder that sometimes our darkest moments can lead us to our greatest achievements.

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *