Justin Hess
Long/short equity, contrarian, special situations, small-cap

LSB Industries: Still A Short

Overview of Idea

LSB Industries (NYSE: LXU) has lost significant shareholder value this past year. The stock is down ~80% YoY, and its bonds are currently trading at ~$0.80 on the dollar. Beyond being a value trap for activists, the firm has faced a string of macroeconomic and operational headwinds. LSB is operating with a significant debt burden (8.9x Net Debt/EBITDA as of September 2015 up from 4.9x in June 2015), and there has been a recent shakeup in management this past fall with the former CEO, the founder's son, stepping down. The bull argument is that if the company can weather the current storm under new leadership, it can begin to repay its debt and eventually split into

Join Seeking Alpha PRO to read this archived article and 11,574 other archived articles
IDEA GENERATORXExclusive access to 10 PRO ideas every day
INVESTING IDEAS LIBRARYXExclusive access to PRO library of more than 15,000 ideas
SECTOR EXPERT NETWORKXExclusive access to all sector experts for direct consultation
PERFORMANCE TRACKINGXTrack performance of all PRO stock ideas
PROFESSIONAL TOOLSXProfessional Idea Filters to zero-in based on industry, market cap and more
"In just the first month of using PRO, I used it to generate two ideas which were actionable for me. As a result of these two positions, I have earned more than 20 times the annual subscription costs for PRO."Michael Yagemann, Greenbridge Capital
"I am pleasantly surprised with the scope of small and mid-cap coverage PRO offers. You can't find that any where else."Patrick Rice, Mainstay Capital Management
You may cancel at any time for any reason, and receive a prompt refund for membership on months paid and not used (max. 6 months). Details