WESTLAKE CORP (WLK) Stock Fundamental Analysis
NYSE:WLK - New York Stock Exchange, Inc. - US9604131022 - Common Stock - Currency: USD
Taking everything into account, WLK scores 4 out of 10 in our fundamental rating. WLK was compared to 85 industry peers in the Chemicals industry. WLK has an average financial health and profitability rating. WLK is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
WLK had positive earnings in the past year.
In the past year WLK had a positive cash flow from operations.
Each year in the past 5 years WLK has 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 1.86%. This is comparable to the rest of the industry: WLK outperforms 52.94% of its industry peers.
With a Return On Equity value of 3.70%, WLK perfoms like the industry average, outperforming 52.94% of the companies in the same industry.
WLK's Return On Invested Capital of 2.78% is on the low side compared to the rest of the industry. WLK is outperformed by 65.88% of its industry peers.
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 7.01%.
The last Return On Invested Capital (2.78%) for WLK is well below the 3 year average (6.90%), which needs to be investigated, but indicates that WLK had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.86% | ||
| ROE | 3.7% | ||
| ROIC | 2.78% |
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
WLK has a Profit Margin of 3.20%. This is comparable to the rest of the industry: WLK outperforms 58.82% of its industry peers.
WLK's Profit Margin has been stable in the last couple of years.
WLK's Operating Margin of 5.94% is on the low side compared to the rest of the industry. WLK is outperformed by 63.53% of its industry peers.
WLK's Operating Margin has been stable in the last couple of years.
WLK has a Gross Margin of 14.34%. This is in the lower half of the industry: WLK underperforms 75.29% of its industry peers.
In the last couple of years the Gross Margin of WLK has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.94% | ||
| PM (TTM) | 3.2% | ||
| GM | 14.34% |
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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so WLK is destroying value.
WLK has about the same amout of shares outstanding than it did 1 year ago.
The number of shares outstanding for WLK remains at a similar level compared to 5 years ago.
Compared to 1 year ago, WLK has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.15 indicates that WLK is not a great score, but indicates only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.15, WLK perfoms like the industry average, outperforming 56.47% of the companies in the same industry.
The Debt to FCF ratio of WLK is 54.89, which is on the high side as it means it would take WLK, 54.89 years of fcf income to pay off all of its debts.
WLK has a Debt to FCF ratio of 54.89. This is in the lower half of the industry: WLK underperforms 62.35% of its industry peers.
WLK has a Debt/Equity ratio of 0.44. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of WLK (0.44) is better than 67.06% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | 54.89 | ||
| Altman-Z | 2.15 |
ROIC/WACC0.35
WACC7.88%
2.3 Liquidity
A Current Ratio of 2.64 indicates that WLK has no problem at all paying its short term obligations.
Looking at the Current ratio, with a value of 2.64, WLK is in the better half of the industry, outperforming 78.82% of the companies in the same industry.
A Quick Ratio of 1.86 indicates that WLK should not have too much problems paying its short term obligations.
WLK has a better Quick ratio (1.86) than 78.82% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.64 | ||
| Quick Ratio | 1.86 |
3. Growth
3.1 Past
The earnings per share for WLK have decreased strongly by -45.81% in the last year.
Measured over the past years, WLK shows a quite strong growth in Earnings Per Share. The EPS has been growing by 9.83% on average per year.
WLK shows a decrease in Revenue. In the last year, the revenue decreased by -1.27%.
Measured over the past years, WLK shows a quite strong growth in Revenue. The Revenue has been growing by 8.38% on average per year.
EPS 1Y (TTM)-45.81%
EPS 3Y-30.59%
EPS 5Y9.83%
EPS Q2Q%-123.13%
Revenue 1Y (TTM)-1.27%
Revenue growth 3Y1.02%
Revenue growth 5Y8.38%
Sales Q2Q%-4.34%
3.2 Future
The Earnings Per Share is expected to grow by 13.40% on average over the next years. This is quite good.
The Revenue is expected to grow by 3.01% on average over the next years.
EPS Next Y-35.99%
EPS Next 2Y4.26%
EPS Next 3Y13.4%
EPS Next 5YN/A
Revenue Next Year-2.27%
Revenue Next 2Y1.86%
Revenue Next 3Y3.01%
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.
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
A Price/Earnings ratio of 20.32 indicates a rather expensive valuation of WLK.
Compared to the rest of the industry, the Price/Earnings ratio of WLK is on the same level as its industry peers.
When comparing the Price/Earnings ratio of WLK to the average of the S&P500 Index (25.91), we can say WLK is valued slightly cheaper.
WLK is valuated correctly with a Price/Forward Earnings ratio of 12.77.
Based on the Price/Forward Earnings ratio, WLK is valued a bit cheaper than 61.18% of the companies in the same industry.
WLK's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 21.85.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.32 | ||
| Fwd PE | 12.77 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of WLK indicates a rather cheap valuation: WLK is cheaper than 87.06% of the companies listed in the same industry.
61.18% of the companies in the same industry are cheaper than WLK, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 110.65 | ||
| EV/EBITDA | 6.12 |
4.3 Compensation for Growth
A more expensive valuation may be justified as WLK's earnings are expected to grow with 13.40% in the coming years.
PEG (NY)N/A
PEG (5Y)2.07
EPS Next 2Y4.26%
EPS Next 3Y13.4%
5. Dividend
5.1 Amount
WLK has a Yearly Dividend Yield of 2.54%.
The stock price of WLK dropped by -34.06% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
WLK's Dividend Yield is a higher than the industry average which is at 3.70.
Compared to an average S&P500 Dividend Yield of 2.36, WLK has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.54% |
5.2 History
On average, the dividend of WLK grows each year by 14.83%, which is quite nice.
WLK has been paying a dividend for at least 10 years, so it has a reliable track record.
WLK has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)14.83%
Div Incr Years20
Div Non Decr Years20
5.3 Sustainability
WLK pays out 69.35% of its income as dividend. This is not a sustainable payout ratio.
WLK's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP69.35%
EPS Next 2Y4.26%
EPS Next 3Y13.4%
72.34
-1.32 (-1.79%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners27.86%
Inst Owner Change5.91%
Ins Owners0.69%
Ins Owner Change3.78%
Market Cap9.29B
Analysts73.91
Price Target108.89 (50.53%)
Short Float %8.38%
Short Ratio3.02
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.54% |
Yearly Dividend2.06
Dividend Growth(5Y)14.83%
DP69.35%
Div Incr Years20
Div Non Decr Years20
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-120.96%
Min EPS beat(2)-147.34%
Max EPS beat(2)-94.57%
EPS beat(4)1
Avg EPS beat(4)-64.75%
Min EPS beat(4)-147.34%
Max EPS beat(4)19.61%
EPS beat(8)3
Avg EPS beat(8)-32.68%
EPS beat(12)5
Avg EPS beat(12)-21.77%
EPS beat(16)9
Avg EPS beat(16)-12.24%
Revenue beat(2)0
Avg Revenue beat(2)-4.37%
Min Revenue beat(2)-4.46%
Max Revenue beat(2)-4.28%
Revenue beat(4)0
Avg Revenue beat(4)-4.31%
Min Revenue beat(4)-6.62%
Max Revenue beat(4)-1.9%
Revenue beat(8)1
Avg Revenue beat(8)-4.02%
Revenue beat(12)2
Avg Revenue beat(12)-2.98%
Revenue beat(16)6
Avg Revenue beat(16)0.75%
PT rev (1m)-18.28%
PT rev (3m)-28.21%
EPS NQ rev (1m)-32.72%
EPS NQ rev (3m)-46.39%
EPS NY rev (1m)-32.64%
EPS NY rev (3m)-55.51%
Revenue NQ rev (1m)-3.07%
Revenue NQ rev (3m)-5.98%
Revenue NY rev (1m)-3.53%
Revenue NY rev (3m)-6.58%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.32 | ||
| Fwd PE | 12.77 | ||
| P/S | 0.77 | ||
| P/FCF | 110.65 | ||
| P/OCF | 8.7 | ||
| P/B | 0.89 | ||
| P/tB | 1.31 | ||
| EV/EBITDA | 6.12 |
EPS(TTM)3.56
EY4.92%
EPS(NY)5.66
Fwd EY7.83%
FCF(TTM)0.65
FCFY0.9%
OCF(TTM)8.31
OCFY11.49%
SpS93.49
BVpS81.02
TBVpS55.41
PEG (NY)N/A
PEG (5Y)2.07
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.86% | ||
| ROE | 3.7% | ||
| ROCE | 3.87% | ||
| ROIC | 2.78% | ||
| ROICexc | 3.21% | ||
| ROICexgc | 4.05% | ||
| OM | 5.94% | ||
| PM (TTM) | 3.2% | ||
| GM | 14.34% | ||
| FCFM | 0.7% |
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 Turnover0.58
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | 54.89 | ||
| Debt/EBITDA | 2.5 | ||
| Cap/Depr | 87.54% | ||
| Cap/Sales | 8.19% | ||
| Interest Coverage | 4.61 | ||
| Cash Conversion | 58.11% | ||
| Profit Quality | 21.82% | ||
| Current Ratio | 2.64 | ||
| Quick Ratio | 1.86 | ||
| Altman-Z | 2.15 |
F-Score6
WACC7.88%
ROIC/WACC0.35
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)-45.81%
EPS 3Y-30.59%
EPS 5Y9.83%
EPS Q2Q%-123.13%
EPS Next Y-35.99%
EPS Next 2Y4.26%
EPS Next 3Y13.4%
EPS Next 5YN/A
Revenue 1Y (TTM)-1.27%
Revenue growth 3Y1.02%
Revenue growth 5Y8.38%
Sales Q2Q%-4.34%
Revenue Next Year-2.27%
Revenue Next 2Y1.86%
Revenue Next 3Y3.01%
Revenue Next 5YN/A
EBIT growth 1Y-22.39%
EBIT growth 3Y-30.04%
EBIT growth 5Y6.87%
EBIT Next Year96.18%
EBIT Next 3Y35.21%
EBIT Next 5YN/A
FCF growth 1Y-95.99%
FCF growth 3Y-43.93%
FCF growth 5Y-9.85%
OCF growth 1Y-66.7%
OCF growth 3Y-18.12%
OCF growth 5Y0.2%