WESTLAKE CORP (WLK) Stock Fundamental Analysis
NYSE:WLK - New York Stock Exchange, Inc. - US9604131022 - Common Stock - Currency: USD
Overall WLK gets a fundamental rating of 4 out of 10. We evaluated WLK against 84 industry peers in the Chemicals industry. WLK has an average financial health and profitability rating. WLK has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
WLK had positive earnings in the past year.
WLK had a positive operating cash flow in the past year.
WLK had positive earnings in each of the past 5 years.
Each year in the past 5 years WLK had a positive operating cash flow.
1.2 Ratios
WLK has a Return On Assets of 0.45%. This is in the lower half of the industry: WLK underperforms 60.98% of its industry peers.
With a Return On Equity value of 0.90%, WLK is not doing good in the industry: 62.20% of the companies in the same industry are doing better.
Looking at the Return On Invested Capital, with a value of 3.40%, WLK is in line with its industry, outperforming 41.46% of the companies in the same industry.
WLK had an Average Return On Invested Capital over the past 3 years of 10.46%. This is above the industry average of 6.57%.
The 3 year average ROIC (10.46%) for WLK is well above the current ROIC(3.40%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.45% | ||
| ROE | 0.9% | ||
| ROIC | 3.4% |
ROA(3y)8%
ROA(5y)5.91%
ROE(3y)17.45%
ROE(5y)12.99%
ROIC(3y)10.46%
ROIC(5y)7.72%
1.3 Margins
WLK has a worse Profit Margin (0.79%) than 60.98% of its industry peers.
In the last couple of years the Profit Margin of WLK has declined.
WLK has a Operating Margin (6.90%) which is comparable to the rest of the industry.
WLK's Operating Margin has declined in the last couple of years.
WLK's Gross Margin of 15.08% is on the low side compared to the rest of the industry. WLK is outperformed by 75.61% of its industry peers.
WLK's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 6.9% | ||
| PM (TTM) | 0.79% | ||
| GM | 15.08% |
OM growth 3Y16.58%
OM growth 5Y-10.07%
PM growth 3Y-4.71%
PM growth 5Y-19.86%
GM growth 3Y9.06%
GM growth 5Y-5.13%
2. Health
2.1 Basic Checks
WLK has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for WLK has been increased compared to 1 year ago.
WLK has about the same amout of shares outstanding than it did 5 years ago.
Compared to 1 year ago, WLK has an improved debt to assets ratio.
2.2 Solvency
WLK has an Altman-Z score of 2.50. This is not the best score and indicates that WLK is in the grey zone with still only limited risk for bankruptcy at the moment.
With a decent Altman-Z score value of 2.50, WLK is doing good in the industry, outperforming 69.51% of the companies in the same industry.
The Debt to FCF ratio of WLK is 10.34, which is on the high side as it means it would take WLK, 10.34 years of fcf income to pay off all of its debts.
WLK has a Debt to FCF ratio (10.34) which is in line with its industry peers.
WLK has a Debt/Equity ratio of 0.43. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.43, WLK is in the better half of the industry, outperforming 64.63% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.43 | ||
| Debt/FCF | 10.34 | ||
| Altman-Z | 2.5 |
ROIC/WACC0.42
WACC8.02%
2.3 Liquidity
WLK has a Current Ratio of 2.79. This indicates that WLK is financially healthy and has no problem in meeting its short term obligations.
WLK's Current ratio of 2.79 is fine compared to the rest of the industry. WLK outperforms 74.39% of its industry peers.
WLK has a Quick Ratio of 2.04. This indicates that WLK is financially healthy and has no problem in meeting its short term obligations.
WLK has a Quick ratio of 2.04. This is in the better half of the industry: WLK outperforms 78.05% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.79 | ||
| Quick Ratio | 2.04 |
3. Growth
3.1 Past
WLK shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -37.22%.
Measured over the past 5 years, WLK shows a small growth in Earnings Per Share. The EPS has been growing by 1.36% on average per year.
The Revenue has decreased by -6.88% in the past year.
The Revenue has been growing slightly by 7.76% on average over the past years.
EPS 1Y (TTM)-37.22%
EPS 3Y53.93%
EPS 5Y1.36%
EPS Q2Q%-35.91%
Revenue 1Y (TTM)-6.88%
Revenue growth 3Y18.69%
Revenue growth 5Y7.76%
Sales Q2Q%0.06%
3.2 Future
The Earnings Per Share is expected to grow by 6.84% on average over the next years.
Based on estimates for the next years, WLK will show a small growth in Revenue. The Revenue will grow by 2.76% on average per year.
EPS Next Y-21.16%
EPS Next 2Y-1.3%
EPS Next 3Y6.84%
EPS Next 5YN/A
Revenue Next Year-2.82%
Revenue Next 2Y0.8%
Revenue Next 3Y2.76%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 19.47, which indicates a rather expensive current valuation of WLK.
WLK's Price/Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Earnings ratio of 28.46, WLK is valued a bit cheaper.
The Price/Forward Earnings ratio is 14.17, which indicates a correct valuation of WLK.
Based on the Price/Forward Earnings ratio, WLK is valued a bit cheaper than the industry average as 62.20% of the companies are valued more expensively.
WLK is valuated cheaply when we compare the Price/Forward Earnings ratio to 92.56, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.47 | ||
| Fwd PE | 14.17 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, WLK is valued a bit cheaper than 74.39% of the companies in the same industry.
WLK's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 32.83 | ||
| EV/EBITDA | 8.52 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)14.34
EPS Next 2Y-1.3%
EPS Next 3Y6.84%
5. Dividend
5.1 Amount
WLK has a Yearly Dividend Yield of 1.78%. Purely for dividend investing, there may be better candidates out there.
WLK's Dividend Yield is comparable with the industry average which is at 3.22.
Compared to the average S&P500 Dividend Yield of 2.27, WLK is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.78% |
5.2 History
On average, the dividend of WLK grows each year by 13.11%, which is quite nice.
WLK has paid a dividend for at least 10 years, which is a reliable track record.
WLK has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)13.11%
Div Incr Years20
Div Non Decr Years20
5.3 Sustainability
272.92% of the earnings are spent on dividend by WLK. This is not a sustainable payout ratio.
The dividend of WLK is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP272.92%
EPS Next 2Y-1.3%
EPS Next 3Y6.84%
WESTLAKE CORP
NYSE:WLK (1/31/2025, 8:04:00 PM)
After market: 114.27 0 (0%)114.27
-1.57 (-1.36%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners26.91%
Inst Owner Change-0.12%
Ins Owners0.69%
Ins Owner Change0.32%
Market Cap14.71B
Analysts71.67
Price Target159.58 (39.65%)
Short Float %4.72%
Short Ratio2.67
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.78% |
Yearly Dividend1.73
Dividend Growth(5Y)13.11%
DP272.92%
Div Incr Years20
Div Non Decr Years20
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-8.54%
Min EPS beat(2)-36.7%
Max EPS beat(2)19.61%
EPS beat(4)2
Avg EPS beat(4)-2.1%
Min EPS beat(4)-36.7%
Max EPS beat(4)29.38%
EPS beat(8)4
Avg EPS beat(8)-0.11%
EPS beat(12)7
Avg EPS beat(12)1.27%
EPS beat(16)11
Avg EPS beat(16)5.16%
Revenue beat(2)0
Avg Revenue beat(2)-4.26%
Min Revenue beat(2)-6.62%
Max Revenue beat(2)-1.9%
Revenue beat(4)1
Avg Revenue beat(4)-2.52%
Min Revenue beat(4)-6.62%
Max Revenue beat(4)0.44%
Revenue beat(8)1
Avg Revenue beat(8)-3.65%
Revenue beat(12)4
Avg Revenue beat(12)0.59%
Revenue beat(16)7
Avg Revenue beat(16)2.07%
PT rev (1m)-1.55%
PT rev (3m)-5.51%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-25.96%
EPS NY rev (1m)0%
EPS NY rev (3m)-15.25%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.28%
Revenue NY rev (1m)-0.41%
Revenue NY rev (3m)-2.15%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.47 | ||
| Fwd PE | 14.17 | ||
| P/S | 1.21 | ||
| P/FCF | 32.83 | ||
| P/OCF | 10.12 | ||
| P/B | 1.38 | ||
| P/tB | 2.01 | ||
| EV/EBITDA | 8.52 |
EPS(TTM)5.87
EY5.14%
EPS(NY)8.07
Fwd EY7.06%
FCF(TTM)3.48
FCFY3.05%
OCF(TTM)11.29
OCFY9.88%
SpS94.2
BVpS82.84
TBVpS56.8
PEG (NY)N/A
PEG (5Y)14.34
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.45% | ||
| ROE | 0.9% | ||
| ROCE | 4.46% | ||
| ROIC | 3.4% | ||
| ROICexc | 4.03% | ||
| ROICexgc | 5.11% | ||
| OM | 6.9% | ||
| PM (TTM) | 0.79% | ||
| GM | 15.08% | ||
| FCFM | 3.69% |
ROA(3y)8%
ROA(5y)5.91%
ROE(3y)17.45%
ROE(5y)12.99%
ROIC(3y)10.46%
ROIC(5y)7.72%
ROICexc(3y)12.04%
ROICexc(5y)8.79%
ROICexgc(3y)15.86%
ROICexgc(5y)11.38%
ROCE(3y)13.72%
ROCE(5y)10.13%
ROICexcg growth 3Y29.71%
ROICexcg growth 5Y-9.85%
ROICexc growth 3Y25.57%
ROICexc growth 5Y-11.17%
OM growth 3Y16.58%
OM growth 5Y-10.07%
PM growth 3Y-4.71%
PM growth 5Y-19.86%
GM growth 3Y9.06%
GM growth 5Y-5.13%
F-Score4
Asset Turnover0.57
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.43 | ||
| Debt/FCF | 10.34 | ||
| Debt/EBITDA | 2.36 | ||
| Cap/Depr | 90.13% | ||
| Cap/Sales | 8.29% | ||
| Interest Coverage | 5.44 | ||
| Cash Conversion | 74.44% | ||
| Profit Quality | 466.67% | ||
| Current Ratio | 2.79 | ||
| Quick Ratio | 2.04 | ||
| Altman-Z | 2.5 |
F-Score4
WACC8.02%
ROIC/WACC0.42
Cap/Depr(3y)92.5%
Cap/Depr(5y)91.16%
Cap/Sales(3y)6.95%
Cap/Sales(5y)7.51%
Profit Quality(3y)154.15%
Profit Quality(5y)163.95%
High Growth Momentum
Growth
EPS 1Y (TTM)-37.22%
EPS 3Y53.93%
EPS 5Y1.36%
EPS Q2Q%-35.91%
EPS Next Y-21.16%
EPS Next 2Y-1.3%
EPS Next 3Y6.84%
EPS Next 5YN/A
Revenue 1Y (TTM)-6.88%
Revenue growth 3Y18.69%
Revenue growth 5Y7.76%
Sales Q2Q%0.06%
Revenue Next Year-2.82%
Revenue Next 2Y0.8%
Revenue Next 3Y2.76%
Revenue Next 5YN/A
EBIT growth 1Y-48.43%
EBIT growth 3Y38.37%
EBIT growth 5Y-3.09%
EBIT Next Year56.51%
EBIT Next 3Y23.89%
EBIT Next 5YN/A
FCF growth 1Y-80.19%
FCF growth 3Y19.03%
FCF growth 5Y12.99%
OCF growth 1Y-56.2%
OCF growth 3Y21.67%
OCF growth 5Y10.64%