Should Value Investors Buy LyondellBasell Industries (LYB) Stock?

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One company value investors might notice is LyondellBasell Industries (LYB). LYB is currently sporting a Zacks Rank #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 12.75, which compares to its industry's average of 19.47. Over the past year, LYB's Forward P/E has been as high as 14.89 and as low as 8.44, with a median of 11.25.

Another notable valuation metric for LYB is its P/B ratio of 1.4. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 2.14. Within the past 52 weeks, LYB's P/B has been as high as 2.33 and as low as 1.30, with a median of 1.78.

If you're looking for another solid Chemical - Diversified value stock, take a look at Methanex (MEOH). MEOH is a Zacks Rank of #1 (Strong Buy) stock with a Value score of A.

Furthermore, Methanex holds a P/B ratio of 1.03 and its industry's price-to-book ratio is 2.14. MEOH's P/B has been as high as 1.52, as low as 0.69, with a median of 1.05 over the past 12 months.

These are just a handful of the figures considered in LyondellBasell Industries and Methanex's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that LYB and MEOH is an impressive value stock right now.

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This article originally published on Zacks Investment Research (zacks.com).

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