Westlake (NYSE:WLK) Stock Price Breaks Above 50 Day Moving Average - Time to Sell?

Key Points

• Westlake shares rose above their 50-day moving average, reaching $68.35 and last trading at $68.21, though they remained well below the 200-day average of $86.67.
• Analyst sentiment is mixed, with four Buy, eight Hold, and three Sell ratings; the consensus rating is Hold with an average price target of $81.13.
• Westlake beat quarterly earnings and revenue estimates, increased its quarterly dividend to $0.533 per share, and offers an annualized yield of about 3.1%; however, the company reported a negative net margin.

Westlake Corporation (NYSE:WLK - Get Free Report) passed above its 50-day moving average during trading on Friday. The stock has a 50-day moving average of $67.98 and traded as high as $68.35. Westlake shares last traded at $68.21, with a volume of 1,181,941 shares trading hands.

Wall Street Analyst Weigh In

WLK has been the topic of a number of research reports. UBS Group set a $86.00 target price on shares of Westlake and gave the stock a "buy" rating in a research report on Monday, October 5th. Mizuho set a $72.00 price target on Westlake in a research note on Thursday, October 1st. BMO Capital Markets restated a "market perform" rating and issued a $96.00 price objective on shares of Westlake in a research report on Monday, July 6th. JPMorgan Chase & Co. decreased their target price on shares of Westlake from $80.00 to $65.00 and set a "neutral" rating on the stock in a research report on Friday, October 16th. Finally, Citigroup restated a "neutral" rating and issued a $67.00 price target (down from $85.00) on shares of Westlake in a report on Monday, October 5th. Four investment analysts have rated the stock with a Buy rating, eight have given a Hold rating and three have given a Sell rating to the company's stock. According to data from MarketBeat, the company currently has an average rating of "Hold" and a consensus price target of $81.13.

Westlake Stock Performance

The company has a current ratio of 2.45, a quick ratio of 1.70 and a debt-to-equity ratio of 0.55. The stock's 50 day moving average price is $67.98 and its two-hundred day moving average price is $86.67. The firm has a market capitalization of $8.72 billion, a PE ratio of -7.12 and a beta of 0.69.

Westlake (NYSE:WLK - Get Free Report) last posted its earnings results on Tuesday, August 4th. The specialty chemicals company reported $2.01 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $1.83 by $0.18. The firm had revenue of $3.27 billion for the quarter, compared to analyst estimates of $3.24 billion. Westlake had a positive return on equity of 0.93% and a negative net margin of 10.94%. Westlake's revenue was up 10.8% on a year-over-year basis. During the same quarter in the prior year, the company earned ($1.11) EPS. On average, equities analysts expect that Westlake Corporation will post 2.30 earnings per share for the current year.

Westlake Increases Dividend

The business also recently declared a quarterly dividend, which was paid on Thursday, September 10th. Stockholders of record on Tuesday, August 25th were issued a $0.5330 dividend. This represents a $2.13 dividend on an annualized basis and a dividend yield of 3.1%. This is a positive change from Westlake's previous quarterly dividend of $0.53. The ex-dividend date of this dividend was Tuesday, August 25th. Westlake's payout ratio is presently -22.23%.

Insider Activity

In related news, Chairman Albert Chao sold 38,873 shares of the stock in a transaction on Tuesday, August 11th. The stock was sold at an average price of $80.28, for a total transaction of $3,120,724.44. Following the sale, the chairman owned 642,880 shares of the company's stock, valued at $51,610,406.40. This trade represents a 5.70% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. 1.40% of the stock is owned by corporate insiders.

Institutional Investors Weigh In On Westlake

Several hedge funds have recently modified their holdings of WLK. Root Financial Partners LLC acquired a new position in Westlake in the third quarter valued at $39,000. Nykredit A S purchased a new position in Westlake during the second quarter worth about $69,000. Rockefeller Capital Management L.P. lifted its position in Westlake by 219.4% during the fourth quarter. Rockefeller Capital Management L.P. now owns 955 shares of the specialty chemicals company's stock worth $71,000 after buying an additional 656 shares during the period. Transamerica Financial Advisors LLC acquired a new stake in Westlake in the 2nd quarter worth about $80,000. Finally, IFP Advisors Inc boosted its stake in Westlake by 58,450.0% in the 2nd quarter. IFP Advisors Inc now owns 1,171 shares of the specialty chemicals company's stock worth $85,000 after buying an additional 1,169 shares during the last quarter. 28.40% of the stock is owned by institutional investors and hedge funds.

Westlake Company Profile

Westlake Corporation is a global manufacturer of performance and essential materials, as well as products used in housing and infrastructure. Headquartered in Houston, Texas, the company serves customers in construction, packaging, healthcare, consumer products, automotive, and other industrial markets.

Westlake's materials portfolio includes chlor-alkali and derivative chemicals, polyethylene, PVC, vinyl intermediates, epoxy resins, and other specialty products. These materials are used in applications such as water treatment, coatings, adhesives, plastics, medical products, and packaging.

Through its housing and infrastructure businesses, Westlake also produces building products including vinyl siding, trim, roofing products, pipe, fittings, and related components.

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