LSB Industries Gets 'Buy' Rating on US Gas Advantage

LSB Industries has been given a 'Buy' rating by analysts due to its cost advantage in using cheap U.S. natural gas compared to European peers.

The company's operational efficiency improvements, particularly at the El Dorado plant, and flexible product mix are expected to support margin growth and resilience against agricultural price fluctuations.

LSB Industries is also working on a carbon capture project that could generate $25-30 million in annual cash flow by 2027. However, regulatory and execution risks remain.

The company's current valuation at 4.7x EV/EBITDA appears undervalued, with potential upside if production and fertilizer prices stay strong after maintenance.