Westlake Corporation (WLK) AI Stock Analysis

• Market Cap: $11.19B
• Dividend Yield: 2.41%
• Average Volume (3M): 1.28M
• Price to Earnings (P/E): 25.4
• Beta (1Y): 0.97
• Revenue Growth: -3.00%
• EPS Growth: -124.79%
• Country: US
• Employees: 15,540
• Sector: Basic Materials
• Sector Strength: 63
• Industry: Chemicals - Specialty
• EPS (TTM): -0.09
• Shares Outstanding: 128,246,260
• 10 Day Avg. Volume: 1,293,863
• 30 Day Avg. Volume: 1,282,791
• PEG Ratio: 0.97
• Price to Book (P/B): 1.40
• Price to Sales (P/S): 1.21
• P/FCF Ratio: 48.16
• Enterprise Value/Market Cap: 1.21
• Enterprise Value/Revenue: 1.15
• Enterprise Value/Gross Profit: 10.26
• Enterprise Value/Ebitda: 9.53
• 1Y Price Target: $88.40
• Price Target Upside: 1.34% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 16

• Rating: 54 Neutral
• Price Target: $89.00 ▲(2.03% Upside)

Westlake Corporation's overall stock score reflects significant financial and operational challenges, with declining revenues and profitability pressures. Technical analysis shows some short-term bullish momentum, but valuation concerns persist due to a negative P/E ratio. The earnings call provided mixed insights, with strong HIP performance but ongoing PEM challenges. The acquisition of ACI/Perplastic Group is a positive strategic move, but the closure of the Pernis facility highlights ongoing difficulties.

Positive Factors

Cost Management

Cost cuts and asset closures should help drive earnings higher.

Demand

HIP saw strong sequential improvement thanks to seasonally better demand across Pipe & Fittings and Building Products.

Earnings

Housing and Infrastructure Products (HIP) beat our forecast handily despite a sharper falloff in revenues, as margins remained elevated.

Negative Factors

Commodity Operations

WLK will essentially exit all commodity-centric operations in Europe.

Downtime and Volumes

The shortfall to our estimates is primarily elevated downtime and lower volumes in the commodity footprint.

Revenue Guidance

WLK's revenue guidance for 2025 was reduced due to a broader slowdown in residential construction.

Westlake Corporation Business Overview & Revenue Model

Company Description

Westlake Corporation (WLK) is a global manufacturer and supplier of petrochemicals, polymers, and building products. The company operates through two primary segments: Olefins and Vinyls. Its core product offerings include polyethylene, polypropylene, PVC resins, and various chemical intermediates that serve a wide range of end markets, including packaging, construction, automotive, and consumer goods.

How the Company Makes Money

Westlake Corporation generates revenue through the production and sale of its diverse chemical and polymer products. The company's key revenue streams include the sale of polyethylene and PVC, which are fundamental to a variety of applications in different industries. Additionally, Westlake benefits from its vertically integrated business model, which enhances cost efficiencies and allows for better control over its supply chain. Strategic partnerships with other manufacturers and distributors also contribute to its revenue, enabling Westlake to expand its market reach and optimize its distribution channels. The company's ability to adapt to market demand and fluctuations in raw material costs further influences its profitability.

Westlake Corporation Financial Statement Overview

Summary

Westlake Chemical faces challenges with declining revenues and profit margins impacting overall financial performance. While the balance sheet shows financial stability with moderate leverage, the cash flow statement highlights a reduction in free cash flow, raising potential concerns about future liquidity.

Income Statement

Westlake Chemical's income statement reflects a decline in revenue and net income over the latest periods. The gross profit margin for TTM (Trailing-Twelve-Months) is around 14.1%, indicating some pressure on profitability. Net profit margin stands at 3.2%, which is lower compared to historical performance. The EBIT margin is 5.2%, and the EBITDA margin is 15.8%, showing moderate operational efficiency despite revenue headwinds.

Balance Sheet

The balance sheet indicates a strong equity position with a stable equity ratio of approximately 50.3% in TTM. The debt-to-equity ratio is 0.53, suggesting manageable leverage. Return on Equity (ROE) is at a lower level of 3.7% for TTM, reflecting decreased profitability impacting shareholder returns.

Cash Flow

Cash flow analysis shows a significant drop in free cash flow in TTM, with a free cash flow growth rate of -72.5%. Operating cash flow remains positive but has decreased compared to prior periods. The operating cash flow to net income ratio is robust at 2.75, suggesting strong cash generation relative to earnings.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	11.76B	12.14B	12.55B	15.79B	11.78B	7.50B
Gross Profit	1.32B	1.96B	2.22B	4.07B	3.50B	1.02B
EBITDA	1.42B	2.21B	1.96B	4.18B	3.69B	1.25B
Net Income	-56.00M	602.00M	479.00M	2.25B	2.02B	330.00M
Balance Sheet
Total Assets	20.81B	20.75B	21.04B	20.55B	18.46B	13.84B
Cash, Cash Equivalents and Short-Term Investments	2.28B	2.92B	3.30B	2.23B	1.91B	1.31B
Total Debt	4.65B	5.28B	5.52B	4.88B	5.18B	3.57B
Total Liabilities	10.02B	9.71B	10.27B	10.09B	9.93B	7.26B
Stockholders Equity	10.28B	10.53B	10.24B	9.93B	7.96B	6.04B
Cash Flow
Free Cash Flow	-54.00M	306.00M	1.30B	2.29B	1.74B	772.00M
Operating Cash Flow	966.00M	1.31B	2.34B	3.40B	2.39B	1.30B
Investing Cash Flow	-1.23B	-1.00B	-1.04B	-2.48B	-3.21B	-509.00M
Financing Cash Flow	-701.00M	-650.00M	-245.00M	-587.00M	1.44B	-216.00M

Westlake Corporation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 87.23
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WLK, the sentiment is Positive. The current price of 87.23 is above the 20-day moving average (MA) of 81.70, above the 50-day MA of 80.48, and below the 200-day MA of 97.55, indicating a neutral trend. The MACD of 1.51 indicates Negative momentum. The RSI at 57.69 is Neutral, neither overbought nor oversold. The STOCH value of 74.48 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for WLK.

Westlake Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RPM	78 Outperform	$16.13B	23.84	25.42%	1.62%	0.51%	17.21%
AVNT	70 Neutral	$3.43B	29.04	5.09%	2.83%	3.28%	1.69%
EMN	65 Neutral	$7.86B	9.76	14.52%	4.82%	1.60%	-3.97%
SQM	65 Neutral	$12.83B	27.88	9.29%	0.47%	-23.20%	1226.72%
Sector *	61 Neutral	$10.28B	6.36	0.75%	2.93%	3.32%	-39.60%
LYB	61 Neutral	$18.35B	77.10	1.08%	9.50%	-14.12%	-89.22%
WLK	54 Neutral	$11.19B	25.36	-0.64%	2.41%	-3.00%	-124.79%

Westlake Corporation Corporate Events

Westlake Corporation to Acquire ACI/Perplastic Group

On August 26, 2025, Westlake Corporation announced its agreement to acquire the global compounding solutions businesses of the ACI/Perplastic Group, a Portugal-based manufacturer serving the wire and cable sectors. This acquisition is expected to enhance Westlake’s Housing & Infrastructure Products segment by integrating ACI’s specialty materials and technology, thereby expanding Westlake’s product portfolio. ACI, with production facilities in Mexico, Portugal, Romania, and Tunisia, reported net sales of approximately EUR 210 million for the year ending December 31, 2024. The transaction is anticipated to close in early 2026, pending regulatory approvals.

Westlake Corporation Reports Q2 2025 Net Loss

Westlake Corporation reported a net loss of $142 million for the second quarter of 2025, impacted by $130 million due to the closure of its Pernis facility in the Netherlands and temporary cessation of operations in China. Despite these challenges, the company’s housing and infrastructure products segment showed resilience with a 16% increase in sales, while the performance and essential materials segment faced a decline in sales volume. The company’s EBITDA, excluding identified items, was $340 million, reflecting a decrease from the previous year due to higher planned turnarounds, unplanned outages, and increased costs.

Westlake Corporation to Close Pernis Facility in Netherlands

Westlake Corporation announced plans to cease operations at its Pernis facility in the Netherlands due to continued business deterioration in Europe. The closure, which follows consultations with local councils and unions, will result in a workforce reduction of approximately 230 employees and incur pre-tax costs of about EUR 190 million. The company will continue to supply customers from its Deer Park, Texas facility.