Westlake (NYSE:WLK) Issues Quarterly Earnings Results

Key Points

• Westlake reported a Q1 GAAP net loss of $100 million (EPS -$0.77), missing the consensus -$0.22, with revenue down about 6.8% and negative margins.
• Management said the Middle East conflict disrupted global supplies (roughly 10%–15% of polyethylene and ~5% of PVC), lifting prices and creating a North America cost advantage that could persist through 2026.
• Its three‑pillar profitability program delivered roughly $150 million of EBITDA uplift in Q1 and remains on track for a $600 million 2026 target, though HIP faces near‑term margin pressure; the company holds about $2.5 billion of cash against $5.6 billion of debt.

Westlake (NYSE:WLK - Get Free Report) posted its quarterly earnings results on Tuesday. The specialty chemicals company reported ($0.77) earnings per share for the quarter, missing the consensus estimate of ($0.22) by ($0.55), Zacks reports. Westlake had a negative net margin of 13.50% and a negative return on equity of 1.22%. The business's revenue was down 6.8% on a year-over-year basis. During the same period in the previous year, the company posted ($0.31) EPS.

Here are the key takeaways from Westlake's conference call:

• The company says the Middle East conflict disrupted global supplies (about 10%–15% of polyethylene and ~5% of PVC), driving higher prices and late‑Q1 volume gains in the PEM segment and creating a North America cost advantage that could persist through 2026.
• Management reports its three‑pillar profitability program delivered roughly $150 million of EBITDA uplift in Q1 and remains on track for the $600 million 2026 target, with epoxy returned to profitability.
• HIP is expected to face near‑term margin pressure from a slow start to the homebuilding season and timing lags in passing through higher PVC resin and transportation costs, prompting guidance toward the low end of its 2026 revenue and 19%–21% EBITDA margin range.
• On a GAAP basis Westlake reported a Q1 net loss of $100 million (EPS -$0.77) and recorded $85 million of identified items (including a $67 million pipe‑and‑fittings settlement); management noted remaining potential litigation exposures.
• Liquidity and capital actions include $2.5 billion of cash/investments, $5.6 billion total debt with a planned $500M debt call, ~$900 million 2026 capex, and a non‑binding LOI to acquire a German PVC/VCM plant (subject to due diligence).

Westlake Stock Performance

Shares of WLK stock traded down $10.34 on Tuesday, hitting $104.53. The company had a trading volume of 1,017,981 shares, compared to its average volume of 1,302,054. The firm has a market cap of $13.39 billion, a P/E ratio of -8.92 and a beta of 0.67. The company has a 50-day moving average price of $111.45 and a 200-day moving average price of $88.93. The company has a quick ratio of 1.65, a current ratio of 2.24 and a debt-to-equity ratio of 0.55. Westlake has a twelve month low of $56.33 and a twelve month high of $124.23.

Westlake Dividend Announcement

The business also recently disclosed a quarterly dividend, which was paid on Wednesday, March 18th. Stockholders of record on Tuesday, March 3rd were issued a $0.53 dividend. This represents a $2.12 annualized dividend and a dividend yield of 2.0%. The ex-dividend date of this dividend was Tuesday, March 3rd. Westlake's payout ratio is -18.12%.

Analyst Ratings Changes

WLK has been the topic of several research analyst reports. UBS Group boosted their price target on Westlake from $129.00 to $139.00 and gave the company a "buy" rating in a research note on Wednesday, March 18th. Bank of America reiterated a "neutral" rating and set a $119.00 price target on shares of Westlake in a research note on Monday, April 6th. Wall Street Zen downgraded Westlake from a "hold" rating to a "sell" rating in a research note on Sunday. Truist Financial boosted their price target on Westlake from $117.00 to $127.00 and gave the company a "buy" rating in a research note on Thursday, March 26th. Finally, Zacks Research raised Westlake from a "strong sell" rating to a "hold" rating in a report on Thursday, February 26th. One analyst has rated the stock with a Strong Buy rating, five have issued a Buy rating, ten have given a Hold rating and one has assigned a Sell rating to the stock. Based on data from MarketBeat, the stock presently has a consensus rating of "Hold" and an average target price of $113.20.

Insiders Place Their Bets

In related news, CFO Mark Steven Bender sold 17,409 shares of the company's stock in a transaction dated Friday, February 27th. The stock was sold at an average price of $100.92, for a total value of $1,756,916.28. Following the completion of the transaction, the chief financial officer owned 44,433 shares of the company's stock, valued at approximately $4,484,178.36. This represents a 28.15% decrease in their position. The transaction was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Insiders own 1.40% of the company's stock.

Hedge Funds Weigh In On Westlake

A number of large investors have recently bought and sold shares of WLK. Caitong International Asset Management Co. Ltd acquired a new position in Westlake in the 3rd quarter worth about $28,000. Quarry LP acquired a new position in Westlake in the 4th quarter worth about $31,000. CIBC Private Wealth Group LLC acquired a new position in shares of Westlake during the third quarter valued at approximately $53,000. NewEdge Advisors LLC raised its holdings in shares of Westlake by 49.6% during the second quarter. NewEdge Advisors LLC now owns 745 shares of the specialty chemicals company's stock valued at $57,000 after acquiring an additional 247 shares during the last quarter. Finally, Transamerica Financial Advisors LLC raised its holdings in shares of Westlake by 37.4% during the fourth quarter. Transamerica Financial Advisors LLC now owns 805 shares of the specialty chemicals company's stock valued at $59,000 after acquiring an additional 219 shares during the last quarter. Institutional investors and hedge funds own 28.40% of the company's stock.

Westlake Company Profile

Westlake Corp. is a global manufacturer of petrochemicals, polymers and building products, serving customers across industrial and residential markets. The company's core operations encompass the production of vinyls—primarily polyvinyl chloride (PVC) and its key feedstock vinyl chloride monomer (VCM)—as well as chlor-alkali products including caustic soda and chlorine. In addition, Westlake produces ethylene, propylene and specialty elastomers, along with construction-related materials such as vinyl siding, trim, windows and roofing systems.

Operating a network of vertically integrated plants and distribution centers, Westlake serves markets in North America, Europe and Asia.

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