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LyondellBasell (LYB) Increases Quarterly Dividend by 5%

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LyondellBasell Industries N.V. (LYB - Free Report) recently stated that its board has declared a quarterly dividend of $1.25 per share, a 5% increase over its first-quarter 2023 payout. With an ex-dividend date of May 26, 2023, the amount will be paid out on Jun 6, 2023, to shareholders on record as of May 30, 2023.

LYB said that 2023 marks the 13th straight year of its annual dividend hike. The rising dividend reflects the company's continuous dedication to offering its shareholders high returns. In addition, it is consistent with LyondellBasell's long-term goal, which was disclosed by the company at its Capital Markets Day, of returning 70% of free cash flow to shareholders. The company will continue to deploy capital prudently as it takes the lead in developing innovations for regular, sustainable living.

Notably, LyondellBasell generated $482 million in cash from operating activities during the first quarter. The company returned $460 million as dividends and share repurchases during the quarter.

Shares of LYB have lost 16.8% over the past year compared with industry’s decline of 7.1%.

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The company, on its first-quarter call, noted that it anticipates a slight increase in global demand driven by usual seasonal trends.  The demand for transportation fuels is expected to increase over the summer, supporting oxyfuels and refining margins.  Delays at the beginning of industry-wide capacity expansions for polyethylene in North America are likely to lower new market supply and support polyethylene margins.  

To keep pace with the market expectation, LyondellBasell estimates operating Intermediates & Derivatives assets at 80%. It anticipates modestly raising global olefins and polyolefins operating rates to 85%.  The company will continue to monitor the impact of shifting global monetary policies and strengthening economic conditions in China on petrochemical markets in the second half of 2023.

Zacks Rank & Key Picks

LyondellBasell currently carries a Zacks Rank #3 (Hold).

Better-ranked stocks to consider in the basic materials space include Koppers Holdings Inc. (KOP - Free Report) , AngloGold Ashanti Limited (AU - Free Report) and Linde plc (LIN - Free Report) . You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Koppers currently carries a Zacks Rank #2 (Buy). The Zacks Consensus Estimate for current-year earnings for KOP is currently pegged at $4.40, reflecting an expected year-over-year growth of 6.3%. It has a trailing four-quarter earnings surprise of roughly 13.64%, on average. KOP has gained around 26.2% in a year.

AngloGold Ashanti currently carries a Zacks Rank #1. The Zacks Consensus Estimate for AU’s current-year earnings has been revised 22% upward in the past 60 days.

The consensus estimate for current-year earnings for AU is currently pegged at $1.94, reflecting an expected year-over-year growth of 50.4%. AngloGold Ashanti’s shares have popped roughly 36% in the past year.

Linde currently carries a Zacks Rank #2. The Zacks Consensus Estimate for LIN’s current-year earnings has been revised 3.8% upward in the past 60 days. Linde beat Zacks Consensus Estimate in each of the last four quarters. It delivered a trailing four-quarter earnings surprise of 6.9% on average. LIN’s shares have gained roughly 12.1% in the past year.

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