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 5 out of 10. We evaluated WLK against 85 industry peers in the Chemicals industry. WLK has an average financial health and profitability rating. WLK has a correct valuation and a medium growth rate.
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.
In the past 5 years WLK has always been profitable.
Each year in the past 5 years WLK had a positive operating cash flow.
1.2 Ratios
WLK has a Return On Assets of 2.88%. This is in the better half of the industry: WLK outperforms 61.45% of its industry peers.
Looking at the Return On Equity, with a value of 5.68%, WLK is in line with its industry, outperforming 55.42% of the companies in the same industry.
WLK has a Return On Invested Capital (3.74%) which is comparable to the rest of the industry.
WLK had an Average Return On Invested Capital over the past 3 years of 6.90%. This is in line with the industry average of 6.82%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.88% | ||
| ROE | 5.68% | ||
| ROIC | 3.74% |
ROA(3y)5.34%
ROA(5y)5.85%
ROE(3y)10.95%
ROE(5y)12.7%
ROIC(3y)6.9%
ROIC(5y)7.19%
1.3 Margins
The Profit Margin of WLK (4.93%) is better than 62.65% of its industry peers.
WLK's Profit Margin has been stable in the last couple of years.
WLK has a Operating Margin (7.96%) which is comparable to the rest of the industry.
In the last couple of years the Operating Margin of WLK has remained more or less at the same level.
WLK has a worse Gross Margin (16.12%) than 73.49% of its industry peers.
WLK's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.96% | ||
| PM (TTM) | 4.93% | ||
| GM | 16.12% |
OM growth 3Y-30.74%
OM growth 5Y-1.4%
PM growth 3Y-33.82%
PM growth 5Y-0.9%
GM growth 3Y-18.41%
GM growth 5Y0.76%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), WLK is destroying value.
The number of shares outstanding for WLK remains at a similar level compared to 1 year ago.
WLK has about the same amout of shares outstanding than it did 5 years ago.
The debt/assets ratio for WLK has been reduced compared to a year ago.
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.
WLK has a Altman-Z score of 2.50. This is in the better half of the industry: WLK outperforms 72.29% of its industry peers.
The Debt to FCF ratio of WLK is 15.00, which is on the high side as it means it would take WLK, 15.00 years of fcf income to pay off all of its debts.
WLK has a Debt to FCF ratio of 15.00. This is comparable to the rest of the industry: WLK outperforms 49.40% of 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.
With a decent Debt to Equity ratio value of 0.43, WLK is doing good in the industry, outperforming 66.27% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.43 | ||
| Debt/FCF | 15 | ||
| Altman-Z | 2.5 |
ROIC/WACC0.47
WACC8.02%
2.3 Liquidity
WLK has a Current Ratio of 2.80. This indicates that WLK is financially healthy and has no problem in meeting its short term obligations.
WLK has a Current ratio of 2.80. This is in the better half of the industry: WLK outperforms 79.52% of its industry peers.
A Quick Ratio of 2.04 indicates that WLK has no problem at all paying its short term obligations.
WLK has a Quick ratio of 2.04. This is in the better half of the industry: WLK outperforms 79.52% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.8 | ||
| Quick Ratio | 2.04 |
3. Growth
3.1 Past
The earnings per share for WLK have decreased strongly by -37.08% in the last year.
The Earnings Per Share has been growing by 9.83% on average over the past years. This is quite good.
The Revenue has decreased by -3.24% in the past year.
The Revenue has been growing by 8.38% on average over the past years. This is quite good.
EPS 1Y (TTM)-37.08%
EPS 3Y-30.59%
EPS 5Y9.83%
EPS Q2Q%-91.67%
Revenue 1Y (TTM)-3.24%
Revenue growth 3Y1.02%
Revenue growth 5Y8.38%
Sales Q2Q%0.6%
3.2 Future
The Earnings Per Share is expected to grow by 34.78% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 5.79% on average over the next years.
EPS Next Y43.87%
EPS Next 2Y34.78%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year4.61%
Revenue Next 2Y5.79%
Revenue Next 3YN/A
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 20.87, the valuation of WLK can be described as rather expensive.
WLK's Price/Earnings is on the same level as the industry average.
When comparing the Price/Earnings ratio of WLK to the average of the S&P500 Index (29.75), we can say WLK is valued slightly cheaper.
WLK is valuated correctly with a Price/Forward Earnings ratio of 14.50.
WLK's Price/Forward Earnings ratio is in line with the industry average.
When comparing the Price/Forward Earnings ratio of WLK to the average of the S&P500 Index (22.44), we can say WLK is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.87 | ||
| Fwd PE | 14.5 |
4.2 Price Multiples
73.49% of the companies in the same industry are more expensive than WLK, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, WLK is valued a bit more expensive than 60.24% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 45.73 | ||
| EV/EBITDA | 7.53 |
4.3 Compensation for Growth
WLK's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
WLK's earnings are expected to grow with 34.78% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.48
PEG (5Y)2.12
EPS Next 2Y34.78%
EPS Next 3YN/A
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.93%, WLK has a reasonable but not impressive dividend return.
WLK's Dividend Yield is comparable with the industry average which is at 3.38.
Compared to an average S&P500 Dividend Yield of 2.30, WLK has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.93% |
5.2 History
The dividend of WLK is nicely growing with an annual growth rate of 14.83%!
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)14.83%
Div Incr Years20
Div Non Decr Years20
5.3 Sustainability
44.15% of the earnings are spent on dividend by WLK. This is a bit on the high side, but may be sustainable.
WLK's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP44.15%
EPS Next 2Y34.78%
EPS Next 3YN/A
108.71
-3.59 (-3.2%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners27.86%
Inst Owner Change4.55%
Ins Owners0.69%
Ins Owner Change3.77%
Market Cap13.99B
Analysts73.91
Price Target136.12 (25.21%)
Short Float %4.48%
Short Ratio2.53
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.93% |
Yearly Dividend2.06
Dividend Growth(5Y)14.83%
DP44.15%
Div Incr Years20
Div Non Decr Years20
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-65.63%
Min EPS beat(2)-94.57%
Max EPS beat(2)-36.7%
EPS beat(4)2
Avg EPS beat(4)-20.57%
Min EPS beat(4)-94.57%
Max EPS beat(4)29.38%
EPS beat(8)4
Avg EPS beat(8)-9.16%
EPS beat(12)6
Avg EPS beat(12)-7.44%
EPS beat(16)10
Avg EPS beat(16)-1.74%
Revenue beat(2)0
Avg Revenue beat(2)-5.45%
Min Revenue beat(2)-6.62%
Max Revenue beat(2)-4.28%
Revenue beat(4)1
Avg Revenue beat(4)-3.09%
Min Revenue beat(4)-6.62%
Max Revenue beat(4)0.44%
Revenue beat(8)1
Avg Revenue beat(8)-3.72%
Revenue beat(12)3
Avg Revenue beat(12)-1.33%
Revenue beat(16)7
Avg Revenue beat(16)1.88%
PT rev (1m)-1.44%
PT rev (3m)-7.77%
EPS NQ rev (1m)-34.37%
EPS NQ rev (3m)-44.65%
EPS NY rev (1m)0%
EPS NY rev (3m)-7.79%
Revenue NQ rev (1m)-2.41%
Revenue NQ rev (3m)-5.1%
Revenue NY rev (1m)0.11%
Revenue NY rev (3m)-1.76%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.87 | ||
| Fwd PE | 14.5 | ||
| P/S | 1.15 | ||
| P/FCF | 45.73 | ||
| P/OCF | 10.65 | ||
| P/B | 1.33 | ||
| P/tB | 1.94 | ||
| EV/EBITDA | 7.53 |
EPS(TTM)5.21
EY4.79%
EPS(NY)7.5
Fwd EY6.9%
FCF(TTM)2.38
FCFY2.19%
OCF(TTM)10.21
OCFY9.39%
SpS94.34
BVpS81.79
TBVpS56.05
PEG (NY)0.48
PEG (5Y)2.12
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.88% | ||
| ROE | 5.68% | ||
| ROCE | 5.21% | ||
| ROIC | 3.74% | ||
| ROICexc | 4.44% | ||
| ROICexgc | 5.64% | ||
| OM | 7.96% | ||
| PM (TTM) | 4.93% | ||
| GM | 16.12% | ||
| FCFM | 2.52% |
ROA(3y)5.34%
ROA(5y)5.85%
ROE(3y)10.95%
ROE(5y)12.7%
ROIC(3y)6.9%
ROIC(5y)7.19%
ROICexc(3y)8.06%
ROICexc(5y)8.28%
ROICexgc(3y)10.44%
ROICexgc(5y)10.79%
ROCE(3y)9.62%
ROCE(5y)10.02%
ROICexcg growth 3Y-33.41%
ROICexcg growth 5Y1.51%
ROICexc growth 3Y-32.2%
ROICexc growth 5Y0.16%
OM growth 3Y-30.74%
OM growth 5Y-1.4%
PM growth 3Y-33.82%
PM growth 5Y-0.9%
GM growth 3Y-18.41%
GM growth 5Y0.76%
F-Score6
Asset Turnover0.59
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.43 | ||
| Debt/FCF | 15 | ||
| Debt/EBITDA | 2.19 | ||
| Cap/Depr | 90.48% | ||
| Cap/Sales | 8.3% | ||
| Interest Coverage | 6.31 | ||
| Cash Conversion | 63.17% | ||
| Profit Quality | 51.17% | ||
| Current Ratio | 2.8 | ||
| Quick Ratio | 2.04 | ||
| Altman-Z | 2.5 |
F-Score6
WACC8.02%
ROIC/WACC0.47
Cap/Depr(3y)96.56%
Cap/Depr(5y)87.18%
Cap/Sales(3y)7.85%
Cap/Sales(5y)7.23%
Profit Quality(3y)142.31%
Profit Quality(5y)149.64%
High Growth Momentum
Growth
EPS 1Y (TTM)-37.08%
EPS 3Y-30.59%
EPS 5Y9.83%
EPS Q2Q%-91.67%
EPS Next Y43.87%
EPS Next 2Y34.78%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)-3.24%
Revenue growth 3Y1.02%
Revenue growth 5Y8.38%
Sales Q2Q%0.6%
Revenue Next Year4.61%
Revenue Next 2Y5.79%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-21.59%
EBIT growth 3Y-30.04%
EBIT growth 5Y6.87%
EBIT Next Year126.33%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-76.5%
FCF growth 3Y-43.93%
FCF growth 5Y-9.85%
OCF growth 1Y-43.75%
OCF growth 3Y-18.12%
OCF growth 5Y0.2%