Vincent Andrews, an analyst from Morgan Stanley, maintained the Hold rating on Westlake Chemical (WLK – Research Report). The associated price target remains the same with $130.00.
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Vincent Andrews has given his Hold rating due to a combination of factors surrounding Westlake Chemical’s current market position and strategic initiatives. One of the primary reasons is the company’s alignment with leading home builders, which suggests potential growth in their HIP business. However, while the anticipated growth is promising, Westlake does not yet have firm projections for 2025, which introduces a degree of uncertainty.
Another factor influencing the Hold rating is Westlake’s current net ethylene short position. The company is exploring options for further integration to improve this position, such as debottlenecking their joint venture with Lotte. While this could enhance their ethylene production, the expansion could take 2-3 years to complete, indicating a longer-term strategic play. Additionally, Westlake’s ability to address affordability challenges in the housing market and maintain customer confidence through product reliability also supports the Hold rating, reflecting a balanced view of potential opportunities and current constraints.
Andrews covers the Basic Materials sector, focusing on stocks such as Eastman Chemical, Dow Inc, and Mosaic Co. According to TipRanks, Andrews has an average return of 5.9% and a 63.79% success rate on recommended stocks.