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research report

The LyondellBasell refinery in Houston.

Validea's pick of the week provides a detailed report on a company that scores well in the stock-screening service's model portfolios. On Validea.ca, investors can analyze 1,000 Canadian stocks through 12 different guru-based models and get individual reports on each company. Globe Investor provides marketing and data services to Validea.ca and receives compensation. Try it.

One of the world's largest plastics, chemical and refining companies, LyondellBasell manufactures products at 57 sites in 18 countries. Its products and technologies include packaging, electronics, automotive parts, home furnishings, construction materials, biofuels and other items that improve the quality of life for people around the world.

It trades for just 8.4 times TTM EPS, part of why the David Dreman-based model has strong interest.

That model also likes its 6.3 price-to-cash flow ratio, which is in the market's cheapest 20 per cent.

The company has grown earnings at a 13 per cent pace over the long term (using an average of the three-, four-, and five-year EPS growth rates), versus 3 per cent for the chemical manufacturing industry average.

The Peter Lynch model likes its 0.49 P/E-to-growth ratio.

It has a 1.09 price-to-sales ratio, which the James O'Shaughnessy-based model likes.

The company has a 14.5 per cent earnings yield (EBIT/enterprise value), impressing the Joel Greenblatt-based model, which also likes its return on capital (EBIT/tangible capital employed) of 33 per cent

The Dreman model also likes its 63 per cent return on equity and 2.3 current ratio

The stock offers a 4.3-per-cent dividend.

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