Company Overview
LSB Industries, Inc. operates within the basic materials sector, specifically focusing on the chemical industry where it manufactures, markets, and sells a variety of chemical products across the United States. The company's core portfolio includes ammonia and urea ammonia nitrate designed for agricultural applications, alongside high purity and commercial grade ammonia, high purity ammonium nitrate, sulfuric acids, and concentrated blends of these essential inputs. As a publicly traded entity with the ticker LXU, the company maintains a market capitalization of $1.11B and employs approximately 513 individuals to support its operational footprint. With an annual revenue stream of $615.21M, these financial figures indicate that LSB Industries holds a mid-cap position in the chemical distribution and manufacturing landscape, reflecting a scale sufficient to secure significant market share without dominating the entire sector.
Financial Health
The company reported a total revenue of $615.21M for the trailing twelve months, generating a net income of $24.61M and an EBITDA of $145.64M during the same period. The substantial gap between the $615.21M in revenue and the $24.61M in net income reveals a significant cost structure where operating expenses, likely including cost of goods sold and administrative costs, consume the majority of gross proceeds before reaching the bottom line. While the net income is modest, the EBITDA figure of $145.64M suggests that earnings before interest, taxes, depreciation, and amortization remain robust, indicating strong operational cash generation potential before financing decisions. However, the company currently reports a free cash flow of -$6,128,125, which indicates a temporary liquidity outflow that may stem from capital expenditures or working capital requirements rather than a fundamental lack of profitability. In terms of liquidity, LSB Industries holds $148.47M in cash against total debt of $497.38M, resulting in a debt-to-equity ratio of 95.66, which characterizes the balance sheet as significantly leveraged. Despite this leverage, the current ratio stands at 2.78, a metric that indicates the company possesses ample short-term assets to cover its short-term liabilities without immediate risk of default. Management effectiveness is further evaluated through return metrics, where the return on equity is 4.9% and the return on assets is 3.4%, figures that suggest the company generates modest returns on the capital deployed by shareholders and utilized in its asset base.
Valuation Assessment
Valuation metrics for LSB Industries, Inc. show a trailing P/E ratio of 45.29 and a forward P/E of 38.93, where the difference between these figures implies that the market expects earnings to grow in the future to justify the lower multiple ahead. The price-to-book ratio is recorded at 2.12, indicating that the market values the company at more than double its net asset value, reflecting a premium over the book value likely due to intangible assets or growth expectations. Alternative valuation perspectives are provided by a price-to-sales ratio of 1.80 and an EV/EBITDA of 9.99, which suggest the company is trading at a reasonable multiple relative to its sales and cash-flow-generating capabilities despite the high earnings multiple. Regarding price volatility over the past year, the stock has traded between a 52-week low of $4.88 and a 52-week high of $15.73, meaning the current trading price sits at a specific point within this established range relative to the maximum and minimum observed levels. The beta value is 0.64, which explains that the stock price exhibits lower volatility relative to the broader market, moving with less intensity than the overall index during periods of market fluctuation.
Growth & Income
LSB Industries, Inc. demonstrated a revenue growth rate of 22.3% year-over-year, while earnings growth is listed as N/A, implying that the company has not yet reported comparable earnings growth data or that growth rates are not currently available for this specific metric. The absence of reported earnings growth figures means that investors cannot currently determine if earnings are expanding faster or slower than revenue, though the strong revenue expansion suggests a growing top line. Since the company does not pay dividends, evidenced by a dividend yield of N/A and a payout ratio of 0.0%, it effectively reinvests all of its earnings back into the business for growth initiatives rather than distributing cash to shareholders. This non-dividend profile aligns with a strategy of capital retention to fund operations and potentially reduce the high debt load, rather than providing a steady income stream to investors.