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1. Company Snapshot

1.a. Company Description

LSB Industries, Inc.engages in the manufacture, marketing, and sale of chemical products.The company provides nitrogen-based fertilizers, such as ammonia, fertilizer grade ammonium nitrate (HDAN), and urea ammonia nitrate for fertilizer and fertilizer blends for corn and other crops, and NPK fertilizer blends applications.


It also offers high purity and commercial grade ammonia, high purity ammonium nitrate, sulfuric acids, mixed nitrating acids, carbon dioxide, and diesel exhaust fluids, as well as concentrated, and blended and regular nitric acids for various applications, including semi-conductor and polyurethane intermediates; pulp and paper, alum, water treatment, metals, and vanadium processing; power plant emissions abatement, water treatment, refrigerants, and metals processing; exhaust stream additive, and horticulture/greenhouse applications; and refrigeration.In addition, the company provides industrial grade ammonium nitrate, ammonium nitrate, and HDAN solutions for ammonium nitrate fuel oil and specialty emulsions for mining, surface mining, quarries, and construction applications.It sells its products through distributors, as well as directly to end customers in the United States, Mexico, and Canada.


The company serves to the agricultural, industrial, and mining markets.LSB Industries, Inc.was founded in 1968 and is headquartered in Oklahoma City, Oklahoma.

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1.b. Last Insights on LXU

LSB Industries' recent performance was negatively impacted by a net loss of $9.1 million in the fourth quarter of 2024, compared to a net loss of $5.3 million in the same period of 2023. The company's net sales of $134.9 million in the fourth quarter of 2024 were slightly higher than the $132.6 million reported in the same period of 2023. However, the net loss was exacerbated by approximately $17.1 million of non-operating items.

1.c. Company Highlights

2. LSB Industries' Q3 2025 Earnings: A Strong Performance

LSB Industries reported a solid third quarter with net sales driven by constructive market conditions in their industrial and fertilizer businesses. The company's revenue growth was accompanied by an EPS of $0.1, beating estimates of $0.07. The company's ability to generate free cash flow is notable, with approximately $36 million generated in the third quarter and $20 million year-to-date. This is a significant improvement, especially after a period of heavy investment. The current 'P/S Ratio' of 1.08 and 'EV/EBITDA' of 5.72 indicate a relatively reasonable valuation.

Publication Date: Nov -20

📋 Highlights

Business Segment Performance

The company's transition out of high-density AN for fertilizers and into AN solution for explosives has optimized their sales mix, driven by robust demand in the mining sector. Nitric acid sales remain strong due to increased domestic production of methylene diphenyl diisocyanate (MDI) as a result of tariffs and antidumping duties on imported MDI. Damien Renwick noted that the AN industrial business for explosives is affected by weather, particularly in the northern US and Canada, but the company is well-equipped to manage this with its current infrastructure and customer arrangements.

Market Dynamics and Pricing

Pricing for UAN averaged $336 per ton on a NOLA basis in Q3, up 65% over Q3 2024, supported by steady exports, lower imports, and strong demand. Urea prices moderated somewhat during the quarter due to the resumption of Chinese exports, but are expected to remain tight due to restricted Chinese exports. The ammonia market is healthy, with Tampa ammonia increasing by $60 to $650 per metric ton for the November settlement.

Growth Opportunities and Initiatives

The company is evaluating growth opportunities, including a potential ammonia expansion at their El Dorado facility, which could add 100,000 tons of capacity. The low-carbon project at their El Dorado facility is progressing, with operations expected to begin by the end of 2026 and generating approximately $15 million in annual EBITDA starting in 2027. Mark Behrman discussed the carbon capture and sequestration (CCS) project, which involves capturing, dehydrating, compressing, and sequestering CO2.

Outlook and Valuation

Analysts estimate next year's revenue growth at -1.1%, indicating a slight decline. However, the company's ability to generate free cash flow and its solid balance sheet with approximately $150 million in cash provide a stable foundation. The 'Free Cash Flow Yield' of 8.45% is attractive, suggesting that the company's valuation is reasonable considering its cash generation capabilities.

3. NewsRoom

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Why LSB (LXU) Might be Well Poised for a Surge

Dec -04

Source: zacks.com

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Is Lsb Industries (LXU) Stock Outpacing Its Basic Materials Peers This Year?

Dec -04

Source: zacks.com

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Lsb Industries (NYSE:LXU) Share Price Passes Above 200-Day Moving Average – Should You Sell?

Nov -19

Source: defenseworld.net

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LSB Industries, Inc. to Participate in NYSE Industrials Virtual Conference

Nov -13

Source: businesswire.com

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LSB Industries, Inc. (LXU) Q3 2025 Earnings Call Transcript

Oct -30

Source: seekingalpha.com

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LSB (LXU) Q3 Earnings and Revenues Top Estimates

Oct -29

Source: zacks.com

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LSB Industries, Inc. Reports Operating Results for the 2025 Third Quarter

Oct -29

Source: businesswire.com

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LSB Industries, Inc. Schedules 2025 Third Quarter Results Release for Wednesday, October 29th and Conference Call for Thursday, October 30th

Oct -15

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.77%)

6. Segments

Ammonium Nitrate and Nitric Acid

Expected Growth: 2.8%

LSB Industries, Inc.'s Ammonium Nitrate and Nitric Acid segment growth of 2.8% is driven by increasing demand from the agricultural sector, particularly in nitrogen-based fertilizers. Additionally, growth in the industrial sector, including mining and construction, contributes to the segment's expansion. Furthermore, LSB's strategic expansion into new markets and product offerings also supports the segment's growth.

Ammonia

Expected Growth: 2.5%

LSB Industries' ammonia segment growth is driven by increasing demand from the agricultural sector, particularly in nitrogen-based fertilizers. Additionally, the company's strategic expansion into the industrial and mining sectors, coupled with its cost-competitive production process, contributes to the 2.5% growth rate.

Urea Ammonium Nitrate

Expected Growth: 3.2%

LSB Industries' Urea Ammonium Nitrate growth of 3.2% is driven by increasing demand from the agricultural sector, particularly in emerging markets, and the company's strategic expansion into new regions. Additionally, LSB's focus on operational efficiency and cost reduction initiatives have contributed to the growth.

Other

Expected Growth: 2.2%

LSB Industries, Inc.'s 'Other' segment growth of 2.2% is driven by increasing demand for its climate control solutions, expansion of its chemical business, and strategic investments in research and development. Additionally, the company's focus on operational efficiency and cost savings initiatives have contributed to the segment's growth.

7. Detailed Products

Anhydrous Ammonia

Agricultural fertilizer used to provide nitrogen to crops

Urea Ammonium Nitrate (UAN) Solution

Liquid fertilizer used to provide nitrogen and other essential nutrients to crops

Sulfuric Acid

Industrial chemical used in various applications, including fertilizer production and wastewater treatment

Nitric Acid

Industrial chemical used in the production of fertilizers, explosives, and other products

Industrial and Specialty Chemicals

Various chemicals used in industrial applications, including mining, water treatment, and oil and gas production

8. LSB Industries, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for LSB Industries, Inc. is medium due to the availability of alternative products and services in the market.

Bargaining Power Of Customers

The bargaining power of customers for LSB Industries, Inc. is low due to the company's strong brand reputation and customer loyalty.

Bargaining Power Of Suppliers

The bargaining power of suppliers for LSB Industries, Inc. is medium due to the presence of multiple suppliers in the market.

Threat Of New Entrants

The threat of new entrants for LSB Industries, Inc. is high due to the low barriers to entry in the industry.

Intensity Of Rivalry

The intensity of rivalry for LSB Industries, Inc. is high due to the presence of several competitors in the market.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 53.81%
Debt Cost 8.05%
Equity Weight 46.19%
Equity Cost 9.49%
WACC 8.72%
Leverage 116.51%

11. Quality Control: LSB Industries, Inc. passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Valhi

A-Score: 4.5/10

Value: 9.5

Growth: 3.1

Quality: 5.9

Yield: 4.0

Momentum: 0.5

Volatility: 3.7

1-Year Total Return ->

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Stock-Card
AdvanSix

A-Score: 4.4/10

Value: 7.7

Growth: 2.9

Quality: 4.1

Yield: 4.0

Momentum: 1.5

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
LSB Industries

A-Score: 3.8/10

Value: 8.1

Growth: 2.8

Quality: 5.0

Yield: 0.0

Momentum: 3.0

Volatility: 3.7

1-Year Total Return ->

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Stock-Card
ASP Isotopes

A-Score: 3.4/10

Value: 6.0

Growth: 1.4

Quality: 3.0

Yield: 0.0

Momentum: 9.5

Volatility: 0.3

1-Year Total Return ->

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Stock-Card
Rayonier Advanced Materials

A-Score: 3.1/10

Value: 6.6

Growth: 3.8

Quality: 0.9

Yield: 0.0

Momentum: 4.0

Volatility: 3.3

1-Year Total Return ->

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Stock-Card
Origin Materials

A-Score: 3.1/10

Value: 8.4

Growth: 5.3

Quality: 4.0

Yield: 0.0

Momentum: 0.0

Volatility: 0.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

8.83$

Current Price

8.83$

Potential

-0.00%

Expected Cash-Flows