2Q26 Commodity Chems Preview - Despite Solid 2Qs, Cutting 2H26-'28 #s Back Down to Reality

Research evidence excerpt

2Q26 Commodity Chems Preview - Despite Solid 2Qs, Cutting 2H26-'28 #s Back Down to Reality

July 15, 2026

Exhibit 2 - LYB Performance vs. WR Commodity Exhibit 3 - LYB Valuation vs. WR Commodity

Chemicals Index Chemicals Index

Source: Factset Source: Factset

Exhibit 4 - LYB Fwd-Yr EV/EBITDA Exhibit 5 - LYB Fwd-Yr EV/EBITDA Multiple

Variance History

Source: Factset

DOW (Peer Perform):

As of 7/14 DOW shrs are +30% YTD, outperforming the WR Commodity Chemicals Index (+15%), the XLB (+12%),

and the S&P 500 (+10%). DOW is trading at ~6.4x consensus fwd-yr EBITDA, slightly below its 5-year median of

~7.0x. We attribute recent trading patterns to recent evidence that Px gains will not be as sticky as once theorized

(inventory build-up, more resilient China supply and signs of demand destruction in importing mkts). Over the past

5 years, DOW's forward EV/EBITDA inter-quartile trading range has been 6.3x-7.5x (at present we expect shrs to

trade toward the lower end as we expect est's to drift lower).

We believe that DOW's valuation will be range-bound with roughly symmetric risk/reward as we are awarding

credit for execution on Transform to Outperform initiatives, but are hesitant to underwrite structural improvements

in industry fundamentals (building and construction demand vs. net capacity additions, etc.). It's probable the

"normalization" process across both Middle Eastern / Asian op rates will require at least ~2 qtrs to return to pre-war

levels, but demand seems to be adjusting to more subdued levels.

We're less enthusiastic re: the probability of further PE supply rationalizations in Europe and NE Asia in '26-'28 (esp.

given recent events) - and note that these were already taking longer to materialize vs. prior projections. Finally, we're