Munger Mode rating: 2 out of 5 — Sell. Our own rating from the research report below, on business quality first: moat durability and management, with price separating the top three.
Summary verdict: LyondellBasell is a competently managed commodity chemical producer with one genuine but narrow advantage — cheap U.S. Gulf Coast ethane feedstock — buried inside a business that has no pricing power, requires enormous capital just to stand still, and is currently being carried through the third year of a global petrochemical depression on a balance sheet with $12.9 billion of debt. The dividend was cut in half in February 2026, the revolving credit facility now restricts share buybacks, the company just paid $310 million to hand its European assets to someone else, and trailing twelve-month earnings are negative. The splendid second quarter of 2026 was a windfall from a Middle East supply disruption, not evidence of a moat. This is an average business — arguably below average in its European half — and average businesses do not deserve capital regardless of price.
Recent filings analysed: 8-K (2026-07-31), 10-Q (2026-07-31), 8-K (2026-05-29), 8-K (2026-05-22).
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