LSB Industries (LXU) is poised to benefit from rising nitrogen prices, but its recent share rally leaves the stock fairly valued, RBC said in a note Tuesday.

"We expect higher nitrogen prices due to the Iran war to drive

higher cash generation," the report said, expecting free cash flow yields of about 9% in 2026 and 11% in 2027.

The note also said the firm has shown "excellent" execution in improving operations and strong discipline in allocating capital.

"However, we think shares are now fairly valued following the valuation run-up since early March," the report said.

RBC downgraded the stock to sector perform from outperform while raising its price target to $14 from $13.

Price: 14.70, Change: -0.31, Percent Change: -2.03