NYSE:WLK

Stock Analysis Report

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Executive Summary

Westlake Chemical Corporation, together with its subsidiaries, manufactures and markets basic chemicals, vinyls, polymers, and building products worldwide. More Details


Snowflake Analysis

Average dividend payer with moderate growth potential.


Similar Companies

Share Price & News

How has Westlake Chemical's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: WLK is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: WLK's weekly volatility (6%) has been stable over the past year.


Market Performance


7 Day Return

-4.1%

WLK

-1.3%

US Chemicals

2.3%

US Market


1 Year Return

24.5%

WLK

22.3%

US Chemicals

23.8%

US Market

Return vs Industry: WLK exceeded the US Chemicals industry which returned 22.3% over the past year.

Return vs Market: WLK matched the US Market which returned 23.8% over the past year.


Shareholder returns

WLKIndustryMarket
7 Day-4.1%-1.3%2.3%
30 Day1.3%3.8%4.8%
90 Day14.6%14.6%14.5%
1 Year26.9%24.5%25.2%22.3%26.6%23.8%
3 Year-24.8%-28.0%23.0%-0.2%45.0%35.4%
5 Year94.0%80.6%114.8%66.3%126.2%101.0%

Long-Term Price Volatility Vs. Market

How volatile is Westlake Chemical's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Westlake Chemical undervalued compared to its fair value and its price relative to the market?

5.9%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: WLK ($82.14) is trading below our estimate of fair value ($87.29)

Significantly Below Fair Value: WLK is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: WLK is poor value based on its PE Ratio (36.5x) compared to the US Chemicals industry average (32.9x).

PE vs Market: WLK is poor value based on its PE Ratio (36.5x) compared to the US market (21.3x).


Price to Earnings Growth Ratio

PEG Ratio: WLK is poor value based on its PEG Ratio (1.1x)


Price to Book Ratio

PB vs Industry: WLK is good value based on its PB Ratio (1.8x) compared to the US Chemicals industry average (2.6x).


Next Steps

Future Growth

How is Westlake Chemical forecast to perform in the next 1 to 3 years based on estimates from 12 analysts?

33.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: WLK's forecast earnings growth (33.2% per year) is above the savings rate (2%).

Earnings vs Market: WLK's earnings (33.2% per year) are forecast to grow faster than the US market (21.6% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: WLK's revenue (4.2% per year) is forecast to grow slower than the US market (10.6% per year).

High Growth Revenue: WLK's revenue (4.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: WLK's Return on Equity is forecast to be low in 3 years time (8.4%).


Next Steps

Past Performance

How has Westlake Chemical performed over the past 5 years?

-1.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: WLK has high quality earnings.

Growing Profit Margin: WLK's current net profit margins (3.9%) are lower than last year (5.7%).


Past Earnings Growth Analysis

Earnings Trend: WLK's earnings have declined by 1% per year over the past 5 years.

Accelerating Growth: WLK's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: WLK had negative earnings growth (-38.5%) over the past year, making it difficult to compare to the Chemicals industry average (-16.3%).


Return on Equity

High ROE: WLK's Return on Equity (5.2%) is considered low.


Next Steps

Financial Health

How is Westlake Chemical's financial position?


Financial Position Analysis

Short Term Liabilities: WLK's short term assets ($3.4B) exceed its short term liabilities ($1.2B).

Long Term Liabilities: WLK's short term assets ($3.4B) do not cover its long term liabilities ($6.0B).


Debt to Equity History and Analysis

Debt Level: WLK's debt to equity ratio (56.7%) is considered high.

Reducing Debt: WLK's debt to equity ratio has increased from 21.9% to 56.7% over the past 5 years.

Debt Coverage: WLK's debt is well covered by operating cash flow (32.6%).

Interest Coverage: WLK's interest payments on its debt are well covered by EBIT (3.2x coverage).


Balance Sheet


Next Steps

Dividend

What is Westlake Chemical current dividend yield, its reliability and sustainability?

1.31%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: WLK's dividend (1.31%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.38%).

High Dividend: WLK's dividend (1.31%) is low compared to the top 25% of dividend payers in the US market (3.86%).


Stability and Growth of Payments

Stable Dividend: WLK's dividends per share have been stable in the past 10 years.

Growing Dividend: WLK's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (47%), WLK's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: WLK's dividends in 3 years are forecast to be well covered by earnings (27.2% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

5.8yrs

Average management tenure


CEO

Albert Chao (70 yo)

16.5yrs

Tenure

US$10,880,451

Compensation

Mr. Albert Yuan Chao serves as the Chief Executive Officer, President and Managing Director of Vinnolit GmbH & Co. KG. Mr. Chao has been President, Chief Executive Officer and Director of Westlake Chemical...


CEO Compensation Analysis

Compensation vs Market: Albert's total compensation ($USD10.88M) is about average for companies of similar size in the US market ($USD10.57M).

Compensation vs Earnings: Albert's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Albert Chao
President16.5yrsUS$10.88m0.33%
$ 35.1m
Steven Bender
Executive VP & CFO13.92yrsUS$3.39m0.022%
$ 2.3m
L. Ederington
Senior VP5.08yrsUS$2.72m0.050%
$ 5.3m
Robert Buesinger
Executive Vice President of Vinyl Products10.75yrsUS$2.74m0.0083%
$ 868.7k
Roger Kearns
Executive VP & COOno dataUS$5.21m0.018%
$ 1.9m
Johnathan Zoeller
Vice President & Chief Accounting Officer0.83yrno datano data
Andrew Kenner
Senior Vice President of Chemical Manufacturing3.5yrsUS$1.38m0.0089%
$ 938.9k
Lawrence Teel
Executive Vice President of Olefins6.5yrsno data0.0057%
$ 599.0k
Karl-Martin Schellerer
Managing Director of Vinnolit Business and Vice President5.17yrsno datano data
Jeff Holy
VP & Treasurerno datano datano data

5.8yrs

Average Tenure

59yo

Average Age

Experienced Management: WLK's management team is seasoned and experienced (5.8 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Albert Chao
President16.5yrsUS$10.88m0.33%
$ 35.1m
Mark McCollum
Independent Director2.67yrsUS$262.20k0.0037%
$ 392.4k
Kimberly Lubel
Independent Director0.67yrno datano data
Dorothy Jenkins
Director17.58yrsUS$247.49k0.055%
$ 5.7m
James Chao
Chairman of the Board16.5yrsUS$8.34m0.21%
$ 22.4m
R. Northcutt
Independent Director7.67yrsUS$263.75k0.010%
$ 1.1m
Marius Haas
Independent Director3yrsUS$246.96k0.0038%
$ 401.8k
Michael Graff
Independent Director7.67yrsUS$262.49k0.010%
$ 1.1m
Jeffrey Sheets
Independent Director3yrsUS$258.21k0.0038%
$ 401.8k
Tsung-Hung Chao
Director3yrsUS$246.96k0.0043%
$ 455.3k
Tsung-Chen Chao
Director2.42yrsUS$246.96k0.0030%
$ 311.6k

3.0yrs

Average Tenure

61yo

Average Age

Experienced Board: WLK's board of directors are considered experienced (3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: WLK insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Westlake Chemical Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Westlake Chemical Corporation
  • Ticker: WLK
  • Exchange: NYSE
  • Founded: 1986
  • Industry: Commodity Chemicals
  • Sector: Materials
  • Market Cap: US$10.491b
  • Shares outstanding: 127.72m
  • Website: https://www.westlake.com

Number of Employees


Location

  • Westlake Chemical Corporation
  • 2801 Post Oak Boulevard
  • Suite 600
  • Houston
  • Texas
  • 77056
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
WLKNYSE (New York Stock Exchange)YesCommon StockUSUSDAug 2004
UEODB (Deutsche Boerse AG)YesCommon StockDEEURAug 2004
0LVKLSE (London Stock Exchange)YesCommon StockGBUSDAug 2004

Biography

Westlake Chemical Corporation, together with its subsidiaries, manufactures and markets basic chemicals, vinyls, polymers, and building products worldwide. It operates through two segments, Olefins and Vin...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/01/24 00:28
End of Day Share Price2021/01/22 00:00
Earnings2020/09/30
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.